Nigeria's Largest Bank Seeks $1.8B for Expansion
April 1, 2024 : Nigeria’s leading financial institution by asset base, Access Holdings Plc, has unveiled plans to raise $1.8 billion to fuel its expansion ambitions over the next four years. This strategic move signifies the company’s aspirations to solidify its position as a dominant force within the African continent’s financial landscape.
Access Holdings’ capital raise initiative is a testament to its commitment to both its existing shareholders and potential new investors. The company plans to secure $1.5 billion, or its naira equivalent, through issuing shares, bonds, or other financial instruments, thereby broadening its investor base. Simultaneously, it aims to generate an additional $287 million (₦399.9 billion) through a rights issue, allowing existing shareholders to maintain their ownership stake while contributing to the company’s growth.
The funds garnered through this capital raise initiative will be strategically allocated to propel Access Holdings’ growth trajectory. A crucial portion will be directed towards bolstering the company’s domestic operations. Additionally, Access Holdings has outlined plans to leverage the capital to expand its footprint into new markets across Africa. Specific targets include Morocco, Egypt, and the United States. This targeted expansion aligns with the company’s vision of doubling its assets outside of Nigeria by 2027. As a result, Access Holdings is positioned to evolve into a prominent pan-African financial institution.
It is important to note that this capital raise initiative coincides with a directive issued by the Central Bank of Nigeria (CBN) urging an increase in Nigerian banks’ capital adequacy ratios. While the specific details of the CBN’s requirements have not been disclosed, Access Holdings’ proactive approach to raising capital ensures it remains compliant with regulatory standards.
In conclusion, Access Holdings’ $1.8 billion capital raise initiative represents a significant development within the Nigerian financial sector. This strategic move strengthens the company’s domestic position and paves the way for its expansion across the African continent. By successfully executing this plan, Access Holdings is poised to become a leading financial powerhouse within Africa.
