Zenith Bank has cancelled its plans to raise N100 billion ($318 million) through the sales of bonds and shares, due to the country’s weak capital markets and the struggling economy.
“The request for shareholders’ approval to raise fresh capital has been withdrawn,” said Michael Anyimah, Zenith’s head of investor relations. He added that the bank had strong buffers to support its operation.
According to Anyimah, last month when it announced plans to raise the funds, the bank expected market conditions to improve. Nigeria, Africa’s second-biggest economy, is currently in its first recession in 25 years, driven by low oil prices which have reduced government revenues and crippled dollar supplies in the country, making operations difficult for businesses.
Shares in the bank, which dropped by 6.4% this year on the Nigeria Stock Exchange (NSE), went up by 0.07% to N13.82 naira on Thursday. They grew by 5% last year. Zenith for 2016 posted a pretax profit of N156.75 billion ($500.5million) compared to the N125.62 billion the previous year.
CHECK OUT THESE INTERESTING STORIES:
- Investors says Nigeria remains ‘critical’ market in Africa despite recession
- Nigeria trade balance turns positive in Q4 as exports jump
- Why CBN Should Enforce Cashless Policy across All States
- Naira now sells at N400 to dollar at black market
- FG to raise N213.7bn Treasury bills next week
- Expert says Pumping Dollars To Strengthen Naira, An Artificial Solution
- Nigeria must create 40m jobs by 2030 – World Bank
- Senate invites CBN gov. Emefiele, Babachir over funds
- CBN Gov. Emefiele urges cooperation on monetary, fiscal policy