UBA Begins N239.4bn Capital Raise via Rights Issue, Paves Way for Strategic Expansion

Nume Ekeghe

United Bank for Africa (UBA) Plc. has initiated its N239.4 billion capital raise through a rights issue, aimed at reinforcing its regulatory capital and advancing its ambitious growth strategy across Africa and beyond.
The rights issue, which opened today, will see the issuance of 6.84 billion ordinary shares at N35 per share, with shareholders entitled to one new share for every five existing shares as of the record date on November 5, 2024.
UBA said the capital raise underscored commitment to strengthening its lending capabilities, enhancing digital infrastructure, and positioning itself for continued expansion in key markets.

In a letter to shareholders, UBA Group Chairman, Tony Elumelu, emphasised that the capital raise was part of a broader N400 billion equity programme, approved by shareholders at the bank’s Annual General Meeting in May.
Elumelu stated, “UBA’s Rights Issue aims to raise N239.4 billion, through the issuance of new Ordinary Shares to our shareholders. The primary objective of this Rights Issue is to further strengthen our capacity to take advantage of growth opportunities and sustain our leadership in the banking industry.”

He stated that beyond regulatory compliance, the funds will expand the group’s lending capacity, invest in digital infrastructure, support sustainable business practices, and expand the group’s African operations.
Elumelu also highlighted how UBA was driving economic growth across Africa.
He said, “Our historic partnership with the Africa Continental Free Trade Area (AfCFTA) Secretariat, where UBA pledged up to US$6 billion in financing over the next three years to support eligible SMEs across Africa underscores our commitment to fostering economic development.”

Elumelu also stated that the issuance was in compliance with the revised minimum capital requirements for Nigerian commercial banks announced by the Central Bank of Nigeria (CBN) earlier this year.
He said, “UBA has consistently demonstrated growth and resilience, evidenced by the Group’s strong financial performance and recent recognition within the industry. UBA’s progressive dividend policy, which has seen an increase by 14.8 per cent annualised dividend yield has demonstrated the Group’s ability to reward shareholders consistently. In 2023/2024, UBA won “Bank of the Year” Awards in eight of its subsidiaries – Cameroon, Chad, Ghana, Cote d’Ivoire, Mozambique, Republic of Congo; Sierra Leone; Tanzania, as well as the Regional Award for Africa and in 2024 has won World Best Frontier Markets Bank and Best SME Bank Africa.
“Application for the provisional allotment of the Rights to the new ordinary Shares will be made exclusively through the NGX e-offer portal during the offer period, while existing shareholders may also apply for additional shares above their provisional allotment as described in the Provisional Allotment Letter. Shareholders who are customers of the Bank are also encouraged to access their Rights through UBA’s internet banking and mobile banking channels.”