BREAKING NEWS: Union Bank meets regulatory deadline on capital adequacy
Category: Mergers & Aquisitions
September 30' 2011 GMT 11:05
Abuja, Nigeria – Union Bank of Nigeria plc, one of Nigeria’s oldest and largest commercial lenders by assets and size, today meets the regulatory deadline set for all the intervened banks to reorganize their existing shareholding structure and recapitalize to regulatory requirements.
At the ThisDay Dome in Abuja, the shareholders of the first generation bank voted as follows: 2.174bln units of shares (99.95%) voted YES, 189,000 units of shares (0.1%) voted NO, 510,833 (0.02%) votes abstained while 397,698 votes (0.02%) were voided.
By the above votes cast in agreement with the proposals of the board, Directors will restructure the existing share capital and recapitalize via the financial accommodation of the Asset Management Corporation or AMCON and the additional injection of 700million USDollars by a new core investor – the African Alliance group. Today’s extra-ordinary general meeting brings to a close, a rigorous process of deft management of Union Bank affairs by the Directors led by Funke Osibodu.
Union Bank shareholders voted unanimously (by show of hands) in favour of all the resolutions presented before the meeting to beat the September 30, 2011 midnight deadline set earlier this year by the Central Bank of Nigeria. Union Bank plc will remain a tradable security on the Nigerian Stock Exchange.
Union Bank has survived all upheavals in the domestic banking industry since its existence some 80 years ago. The financial institution prides itself as energetic with the horse symbol as ‘sterling.’ The lender has one of the most diverse shareholders interests in Nigeria over the decades, making it one of the strongest financial services brand before the country’s independence in October 1960.
In the recapitalisation process, the Asset Management Company of Nigeria (AMCON) will benefit 3.3bln shares for financial accommodation, equity investment of UGPL of 11.0bln shares and issuance of Rights of 18.3bln shares.
The lender rescued from total collapse on August 14, 2009 has kept a strong brand identity with both the public and private sector depositors in Nigeria through extensive branch network and strong market participation. As a listed company on the bourse, Union Bank has consistently created wealth for the shareholders and the investors including market traders through cash and bonus dividends as well as capital appreciation of its listed price.
The latest process of restructuring will reposition the lender as a key driver and player in the banking sector, especially in its core areas of niche lending to sectors of economic growth. Adequate capital and working cash flow for operational purposes will enhance Union Bank’s ability to compete in the new banking space of non-universal banking.
Report Filled by MBC team in Abuja and the Proshare team in Lagos