Fidelity Bank Constitutes Committee on Capitalisation
By Uche Obike and Tunyosola Ayansiji
In a bid to raise the N25 billion capital base required by the Central Bank of Nigeria (CBN) for banks operating in Nigeria, the board of directors of Fidelity Bank Plc has constituted a Board Committee on Capitalisation.
Addressing shareholders recently in Lagos, at the bank's seventh Extra-ordinary General Meeting (EGM), the Chairman, Mr. Emmanuel A. Okechukwu announced that a lot of ground work had been done to raise the new capital base.
"A road map is in the final stages of completion and we wish to use this forum to begin to sensitise members on the future plans for Fidelity," the chairman announced.
He said that their goal remains to build a highly successful and virile financial institution able to stand the test of time and contribute significantly to the well being of stakeholders.
"We stand today on the threshold of an even greater future. I enjoin one and all to come together to promote our interests," Okechukwu pleaded with members.
He recalled that in "the past fourteen days our Industry has changed considerably and your board is well prepared to guide our bank through this period. We are indeed committed to ensuring the continued and increased relevance of Fidelity Bank. We have a good name and strong brand upon which we can leverage at this critical time."
The Chairman disclosed further that their main objective at the Extraordinary General Meeting was to approve a bonus issue of one new share for every four shares held.
"Upon your kind approval of the sum of N306,746,198 from the bank's reserves will be applied towards the issuance of 613,492,396 new shares. This will bring the bank's paid up share capital to N1.53 billion and shareholders' funds to N3.5 billion," he said.
Speaking on the new capital base, Okechukwu noted that the background to the latest development was the belief of the Central Bank that there were too many players operating at too high costs with inadequate capacity.
"The objectives are to ensure institutional capacity as well as to build an industry that is diversified, strong and reliable, one where operators represent better safety and play a developmental role impacting more on society, households and consumers," he said.
In his own comment, the Managing Director/Chief Executive Officer of the bank, Mr. Reginald Ihejiahi explained that the purpose of the EGM was "to formally inform our shareholders about the new role in CBN and secondly to present to them a clear action plan which they have to be noted and approved. So we are now on the purification days as you can see, we are the first bank to have a board meeting after the governor announced the changes on July 6th."
"We are also the first bank I think to bring this to the notice of the shareholders in the meeting and I think we are very happy about that. The plan is to have Fidelity by the end of December 2005 as one of the banks that have met its N25 billion requirement. It will of course involve us having to work with other partners and this is what we are discussing very actively," he disclosed.
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