If you are a shareholder of Unity Bank, you must be a bit worried now about the current value of your investment. The bank had a share reconstruction some month’s back where it reduced the volume of its shares by 10 folds. That move increased its share price by fiat from 50 kobo per share to about N5 per share. However, market capitalisation remained the same.
Unfortunately, since the reconstruction the share price has plummeted by more than half (54%) to the current price of N2.30. As such that original 50 kobo per share is now worth about 23 kobo per share. But why did it embark on such a grand scheme? Here is how the Managing Director Henry Semenitari explained it, according to an article from Guardian
Henry Semenitari explained that the initial volume of shares of 116.8 billion, when compared to its shareholders fund would not generate profit for dividend payment or attract more investors into the bank.
“We had 116.8b and the level of the shares, in relation to our shareholders fund cannot sustain our business module or attract more investors into the bank. It just happened a month ago and it is at the right time. It is strictly on performance and we would work tirelessly to enhance shareholders value” he assured.
He pointed out that its banking transactions through e- business contributed to major success recorded by the bank in 2014 financial year.
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