The Managing Director of NPF Microfinance Bank Plc, Akinwunmi Lawal, has announced the intention of the bank to raise funds from the Nigerian Stock Exchange (NSE) through a public offer.
The company is betting on its impressive dividend payout record to lure investors to subscribe to its shares, thereby, increasing its working capital. The bank will commence a three-year strategy from 2019 to 2021. Other reasons for selling its shares include incorporation of information technology to meet customers needs and branch improvement, among others.
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The plan and purpose of the fundraising were disclosed at the 25th Annual General Meeting (AGM) of the bank held in Akwa Ibom, for the financial year ended December 31, 2018.
The bank is targeting its existing shareholders as well as prospective shareholders with the fundraising. According to a report, the success of the public offer is tied to the successful payout of dividend for the last 20 years.
The fundraising would, however, not proceed until NPF Microfinance Bank secures regulatory approval. This public offering is coming just as the lender concluded a three-year strategic plan that spawned from 2016 to 2018. Its new plan is set to reposition the bank in the provision of microfinance services.
While speaking about the performance of the bank, Lawal highlighted the growth difference in the company’s assets and loans.
“The deposit liability moved from N9.126 billion to N10.465 billion showing a growth of 14.67% which indicated the continued growth of our customer’s trust and confidence in our mission. Our borrowing from various intervention funds increased by 34.08% to N2.078 billion from N1.550 billion and this is accountable for the increase in interest expenses by 34.7%.”
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What you need to know: In maintaining NPF Microfinance Bank’s dividend payment culture, Lawal said the payment of N114.3 million was recommended as dividends. This means it will be offered at a rate of 5 kobo per share. He added that various reserves would receive payment of N81.4 million for future developmental projects.
Note: NPF Microfinance Bank’s total asset increased by 10.31% from N15.952 billion recorded in the previous year to N17.597 billion in 2018.
The loans and advances hit N10.593 billion in 2018 from N9.008 billion in 2017. This represented a 17.59% growth.
