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Access Bank assures investors of higher returns

By on February 7, 2015

The Managing Director of Access Bank, Mr. Herbert Wigwe, on Thursday called on investors to patronise the on-going Rights Issue, saying the bank  will deliver good return on their investments.

Access Bank selling 7.628 billion shares of 50 kobo to N6.90 to raise about N52.6 billion.Speaking at the bank’s Facts Behind the Figures at  the Nigerian Stock Exchange in Lagos, Wigwe said investors  should  take position  through the issue given the strong fundamentals of the bank and strategies being out in place to deliver improved returns to investors.

According to him, the share price of the bank, like most of share prices in the kart is not reflecting the fundamentals of the bank, saying the bearish market has driven equities prices very low.

He said, “We don’t manage share price, but the fundamentals of the bank. We are going to give good returns on investment as our target is to be among top three banks in 2017.”

Wigwe disclosed that the bank was already talking to institutional investors, high networth investors and individuals, particularly the investors who understand the value of long term investments.

He said the fresh capital will be used to boost the bank’s working capital, enhance its information and expand network, which he said would lead to improved performance and returns to investors.

Already analysts at Meristem Securities Limited, have side upside potential with a target price of N8.74 for the year.

“Incorporating  the expected dilution of earnings from the bank’s rights issue, we arrived at a target price of N8.74 for 2015, which also reflects the tighter operating environment expected. Access bank, however, remains a good company, from which we expect an impressive performance in 2015 in spite of the restrictive operating environment, in furtherance to the bank’s past achievements” they said.

Some shareholders of the bank have begun to take up their rights. For instance, Mr. Boniface Okezie of Progressive Shareholders Association of Nigeria,  said he was subscribing to the issue despite the fact that it is coming at a period when share prices are declining in the market.

According to Okezie, the additional capital will enable Access Bank to leverage enlarged balance sheet and optimise returns in a sustainable, risk-controlled manner and enhance shareholders value.

Meanwhile, trading at the stock market closed on a bearish note yesterday after three days of gains. The NSE All-share Index depreciated by 1.36 per cent to close at 30,200.97points, while market capitalisation shed N121.36 billion to close at N10.08 trillion. Consequently, the market’s Year-To-Date loss stood at 12.86 per cent.

 

[ThisDay]