Nigeria’s biggest lender by market value Guaranty Trust Holding Company (GTCO) raised the outstanding cash its banking unit needs to meet the N500 billion minimum regulatory capital that local banks with foreign subsidiaries now require to continue to operate abroad.
The corporation’s rights issue sold 7 billion ordinary shares for a total consideration of N365.9 billion, it announced on Friday, and has handed the proceeds to Guaranty Trust Bank, its commercial banking business.
It is the third of Nigeria’s five largest lenders in asset terms to reach the milestone, Access Holdings and Zenith Bank being the early birds.
“Through this capital injection, the share capital of GTBank has been increased from N138,186,703,485.78 to N504,037,107,058.45 and ensures the bank’s compliance with the new minimum capital requirement for commercial banks with international authorisation stipulated by the Central Bank of Nigeria,” the banking group stated in a regulatory note.
The fund is to facilitate scale-up plans, encompassing expansion of branch network, fortification of IT infrastructure, asset growth and cashing in on emerging opportunities in the markets where it operates.
GTCO conducted the rights issue as the second leg of its equity capital raise after the first phase, held last year as an offer for subscription, fell short of its target, sourcing only N209.4 billion from investors against the original plan for N400.5 billion.
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In July, GTCO had priced a dollar equity offer of $105 million ordinary shares at a reference price of N70 ($0.0459) per unit on the London Stock Exchange, seeking to issue 2.3 billion new shares.
The holding company, which in recent years branched out from core commercial banking into payments, pensions and asset management, cross-listed its shares in London in July, allowing the group access to a foreign investor base.
According to Nigeria’s new capital rules, banks with national and regional authorisations have until March 2026 to increase their core capital to N200 billion from N25 billion and to N50 billion from N10 billion respectively, just like their peers holding international licences.