News Column

Nic Bank Gets Shareholders' Nod to Raise Sh2.1 Billion Fresh Capital

August 7, 2014

Constant Munda

MEDIUM-SIZED lender NIC Bank yesterday received approval from shareholders to raise Sh2.1 billion through a mix of rights issue and a corporate bond after an extra ordinary general meeting in Nairobi.

Proceeds from the bank's third cash call in seven years will help boost its expansion into the East Africa market, it said in a statement.

The publicly traded firm on Nairobi Securities Exchange said it would now proceed to seek regulatory approval from Capital Markets Authority.

The cash call is slated for between next month and November if approved by the CMA, the bank said, but did not disclose terms of the offer.

"If successful, the corporate bond and rights issue will help us focus on continued growth in the coming years with more focus on deal-making opportunities in Kenya and the region," said managing director John Gachora.

The bank previously raised 2.1 billion in August 2012 and Sh1.1 billion that helped set up subsidiaries in Uganda and Rwanda respectively.

NIC's total capital to total risk-weighted assets ratio fell to 12.52 per cent in June 2014 from 15.77 per cent a year before, slightly above minimum statutory requirement of 12 per cent.

The statutory ratio will go up to 14.5 per cent from January next year, meaning the bank has to beef it up.

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Source: AllAfrica

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