Nigeria’s Wema Bank raising $100 mln Tier II capital to grow loans

LAGOS (Reuters) – Nigeria’s Wema Bank aims to complete a $100 million Tier II capital raising exercise by the second quarter of this year to fund its growing foreign currency loan portfolio, its chief financial officer said on Thursday.

Tunde Mabawonku said the commercial lender also planned to start the process of raising fresh equity capital of between 30 billion naira ($151 million) to 40 billion naira, from strategic investors by the fourth quarter.

Mabawonku said he expected Wema Bank’s capital ratio to top 25 percent next year, after the capital raising exercise from 18 percent now.

“The bank is raising $100 million…to shore up existing working capital. The funds will not be converted to naira but will be used to fund our growing foreign currency portfolio,” Mabawonku told Reuters.

Shares in Wema Bank surged 8.8 percent to 1.11 naira, mirroring the rise on the index which climbed to an 18-week high on Thursday lifted by positive sentiments following a peaceful presidential vote won by the opposition leader.

($1 = 199.0000 naira)