FCMB to Launch Fresh Equity Offer as Part of Expansion Strategy, After Raising N147.5bn in Oversubscribed Public Offer

First City Monument Bank Group Plc (FCMB) has announced plans to raise fresh equity capital through an Offer for Subscription, following shareholder approval at its Extraordinary General Meeting (EGM) held on December 19, 2024.

In a statement released to the Nigerian Exchange (NGX), the company said the move is part of its strategy to strengthen its capital base in anticipation of both regional and international expansion.

Proceeds from the equity raise will be injected as additional capital into its flagship subsidiary, First City Monument Bank Limited.

The board disclosed that the pricing of the offer will be based on the prevailing market price, with a discount structure to make the offer attractive to investors. However, full details—including the size, structure, and timeline of the capital raise—will be made public once regulatory approval is secured from the Securities and Exchange Commission (SEC).

Backstory

On December 30, 2024, FCMB announced the successful completion of its landmark public offer, raising N147.5 billion with a 33% oversubscription.

According to the company, a total of N147,508,464,568.60 was raised and verified by regulators, while N144,559,788,701.30 was absorbed through the issuance of 19.8 billion ordinary shares at N7.30 per share. This brought the company’s post-offer issued shares to 39.6 billion.

Regulatory approvals were also received to downstream the net proceeds from the holding company to the banking subsidiary, boosting First City Monument Bank’s paid-up share capital and share premium—recognized as eligible capital under the Central Bank of Nigeria’s (CBN) recapitalization framework—to more than N240 billion. This exceeded the minimum requirement for a national banking license.

The Group noted that subsequent phases (2 and 3) of its capital program are already underway to ensure First City Monument Bank Limited meets the higher minimum capital requirement needed to retain its international banking license. This aligns with FCMB’s long-term vision to become a global financial services group of African origin, renowned for leadership in its chosen markets.

Growing appetite for Nigerian bank equities

The fresh equity plan comes at a time when investor appetite for Nigerian banks’ shares is witnessing a remarkable upswing. FCMB’s 33% oversubscription mirrors similar outcomes across the sector, where multiple banks have recorded strong demand in their recent equity offers. This has been fueled by both institutional and retail investors seeking to take positions in lenders they perceive as resilient despite Nigeria’s economic headwinds.

In the last year, several Nigerian banks—including tier-1 giants and mid-tier players—have returned to the capital market in quick succession, either through rights issues, private placements, or public offers. Market analysts attribute this surge in fundraising activity to the Central Bank’s recapitalization directive, which has set higher capital thresholds for banks depending on the scope of their licenses.

However, beyond regulatory pressure, the frequency of these equity raises also signals renewed investor confidence in the sector. Oversubscriptions, such as those seen with FCMB’s offer, highlight the perception that well-capitalized banks are better positioned to weather currency volatility, inflationary pressure, and the evolving global economic environment.

By returning to the market once again, FCMB is not only strengthening its balance sheet but also tapping into a wave of momentum that has made banking stocks some of the most attractive on the Nigerian Exchange in recent months.