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Business & Finance

Diamond Bank, FCMB Set To Raise New Capital

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Diamond Bank is considering raising fresh capital and selling some assets in order to maintain its capital ratios.

The bank’s management says the capital plan will ensure it meets all regulatory requirements both in the short term and in the future.

Diamond Bank’s capital adequacy ratio had fallen to 15.6 percent of assets by mid-year from 18.6 percent a year ago.

The bank’s chief executive, Uzoma Dozie, told an analysts’ conference call, “We are doing a capital management plan and that will determine how much capital we want to raise, tenor and size.

“We don’t have any need to grow our branch network any more. We are also looking at some assets that we can dispose of and we are a long way into that.”

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Meanwhile, mid-tier bank FCMB plans to raise 10 to 15 billion naira of Tier II capital to boost its balance sheet and will target its retail investors for the offering.

FCMB’s capital adequacy ratio was close to the regulatory limit of 15 percent of assets at mid-year, and the bank’s management say the capital raising is to provide an additional cushion.

FCMB CEO, Mr Ladi Balogun, said, “For the Tier II we would be looking at anywhere in the range of 10 to 15 billion naira. It’s really going to be targeted at retail because we feel that the rates from institutions will be high.”

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