Nigeria’s oldest indigenous bank, Wema Bank Plc is considering shifting the issuance of its second tranche N20 billion bond to further boost its capital base
The Bank said if the high interest rate does not reduce, it might probably not raise the bond this year and wait until April next year.
The Bank’s Chief Finance Officer, Mr. Tunde Mabawonku, said they are targeting this month to raise fresh capital, following the authorization of the Central Bank of Nigeria’s (CBN) of a National Banking License in 2015.
The Bank, according to him was granted approval by Securities and Exchange Commission (SEC) to raise a N50 billion bond in 2016, but has raised N6.25 billion so far.
According to him, Wema Bank still have availability for N43 billion to raise in the capital market, but said it might be put on hold because of the prevalent high interest rate, while the outlook for inflation rate might still be very high.
For the time being, he explained that the economy is improving, foreign exchange is available, and customers are paying down on their loans and better liquidity in the market.
In view of this trend, he said that Wema Bank does not see any deteriorating in the Non-Performing Loan (NPL) while the outlook for capital adequacy ratio this year will remain around 12 per cent against the CBN minimum threshold of 10 per cent.