Wema Bank, a leading Nigerian financial institution partly owned by gambling tycoon Kessington Adebutu, is raising ₦149.3 billion ($98.9 million) through a rights issue to bolster its capital base in line with new regulatory requirements.
The offering consists of 14.29 billion shares priced at ₦10.45 ($0.007) per share and is a crucial step in ensuring the bank meets the Central Bank of Nigeria’s (CBN) March 2026 deadline for higher capital reserves. The bank has submitted an application to the Nigerian Exchange Limited (NGX) for approval and listing, with Global Asset Management Nigeria Limited and Qualinvest Capital Limited acting as stockbrokers.
Existing shareholders will be entitled to purchase two new shares for every three held as of March 5, 2025.
CBN’s Recapitalization Mandate
The move comes as part of the CBN’s recapitalization directive issued in 2024, which requires banks to increase their capital base to strengthen the financial system. The new minimum capital requirements are as follows:
•₦500 billion ($331.1 million) for international banks
•₦200 billion ($132.43 million) for national banks
•₦50 billion ($33.1 million) for regional banks
As a national bank, Wema Bank must meet the ₦200 billion benchmark by March 31, 2026.
Kessington Adebutu’s Stake and Wema Bank’s Performance
Kessington Adebutu, the founder of Premier Lotto Limited (Baba Ijebu), holds a 28.26% stake in Wema Bank through Neemtree Limited, an investment vehicle he created in 2013 for strategic acquisitions. His daughter, Abolanle Matel-Okoh, also owns a 4.54% stake in the bank.
Wema Bank recently reported a net profit of ₦88.83 billion ($58.87 million) for 2024, marking a 146.8% increase from ₦35.98 billion ($23.85 million) in 2023. The sharp rise in earnings underscores the bank’s strong operational performance and market positioning.
Broader Capital-Raising Plans
Beyond the ongoing ₦149.3 billion rights issue, Wema Bank previously announced plans to raise ₦200 billion ($132.6 million) through a rights issue and private placement, with the next phase set to launch on April 1, 2025.
So far, the bank has already secured ₦40 billion ($26.5 million) in the first tranche of its recapitalization efforts, reaffirming its commitment to meeting regulatory requirements while positioning itself for long-term growth in Nigeria’s evolving banking landscape.
