NIC Bank has received approval from the Capital Markets Authority to carry out a rights issue agreed on by the bank during its fifty second Annual General Meeting (AGM) held in May this year. Read more on the AGM here.
Remarking on the regulator’s approval, NIC Group Managing Director James Macharia said “This is a significant milestone for us as we prepare to take NIC Bank to the next growth level”, adding that the additional capital will give NIC shareholders the opportunity to participate in the bank’s growth. This will be Kenya’s second largest rights issue of this year after Kenya Airways which raised 14.48 billion through a rights issue last month.
The rights issue is intended to raise 2.07 billion shillings by issuing 98,724,391 new ordinary shares to finance the bank’s local and regional expansion. NIC currently has subsidiaries in East Africa with NIC Bank Tanzania and NIC Bank Uganda. The capital raised will also go towards acquiring modern T24 banking software.
Only shareholders in the companies’ register by July 30th will be entitled to take part in the rights issue which is scheduled to start on the 27th of August and end on the 7th of September. The new shares will be priced at KES 21 per share, representing a 36.7 percent discount on the shares based on their market price on the 19th of July.
This will be NIC’s second rights issue, the other having been in 2007 when the bank offered 16.48 million new shares through a rights issue that raised 1.7 billion shillings used to expand its branch network.
NIC is one of Kenya’s fastest growing banks, having grown its year-to-year pre-tax profit by an average of 40 percent since 2007 to 3.6 billion shillings last year. Pesatalk will continue to keep you updated on the NIC rights issue as it draws nearer.