Wema Bank to redesignate as regional bank

Wema Bank to redesignate as regional bank

May 26, 2010 By Michael Eboh


Wema Bank Plc has announced plans to apply for a regional banking licence under the proposed abolition of universal banking and the re-licensing regime of the Central Bank of Nigeria, CBN.


The bank, in a statement signed by Mr. Oluwole Ajimisinmi, presented to the Nigerian Stock Exchange, NSE, Tuesday, stated that this was part of plans to meet up with CBN’s recapitalisation directive.


The bank added that it planned to raise N49 billion from the capital market, via a special placing offer where N15 billion will be sought from selected strategic local investors while N34bn will be got from a group of foreign investors.


It further stated that it would take apply for the N200bn Small and Medium Scale Enterprises, SME, Refinancing Fund and the soon-to-be established Asset Management Company of Nigeria, AMCON, to recover about N12bn of its toxic assets.The statement reads, “The bank intends to apply for a regional licence under the proposed new licensing regime of the Central Bank of Nigeria, CBN, when the guidelines are released.


“Internal recovery efforts are estimated to yield about N10 billion between January and May 2010. We are  quite close in achieving the set target.“The bank will also leverage on recent initiatives of CBN to discount some provisioned assets with the Asset Management company, where at least N10bn would be recovered, about N2bn of provisioned loans will be refinanced under the N200bn SME Refinancing Fund established by CBN and being managed by the Bank of Industry.


Also, in its first quarter audited results for the period ended, 31 March 31 2010, released to NSE, the bank posted a gross earnings of N8.43bn, appreciating by 4.41 per cent from N8.08bn recorded in the comparable period of 2009.  It posted a profit before tax of N795m compared to a loss before tax of N2.03bn in 2009, while its recorded a profit after tax of N676m compared to a loss after tax of N2.05bn in 2009.


(Source:Vanguard)


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