Ogbonna: Access Holding’s rights issue key component of 2023-2027 strategic plan

Access Bank, one of Nigeria's leading financial institutions, is gearing up for a significant move in its strategic plan for the coming years. The Managing Director and CEO, Roosevelt Ogbonna, recently revealed that the Rights Issue is a pivotal component embedded in the bank's 2023-2027 strategic plan. This move comes as the bank transitions from an investment phase into a consolidation phase, marking a new chapter in its growth trajectory. The Rights Issue is open to existing shareholders at 19 naira 75 kobo per share and is offered on the basis of one for every two ordinary shares held as of Friday, June 7, 2024. This strategic initiative aims to raise capital to support not only the bank but also other verticals operating under the holding company. Ogbonna emphasized the value proposition for shareholders, highlighting the intrinsic worth of Access Bank that continues to grow. At a trading price of 19.75, the stock remains at a deep discount to its intrinsic value, signaling potential value accretion in the future. The market, although not without its challenges, still values information, especially in an environment where expansion and growth are key priorities. As Access Bank shifts gears from an investment phase to a consolidation phase, shareholders can expect significant value accretion, including an enhanced dividend payout ratio. Despite being the largest bank in Nigeria by balance sheet metrics, Access Bank has not been as aggressive in its dividend payouts compared to its peers. However, with the upcoming consolidation phase, shareholders can anticipate a more substantial return on their investments. Ogbonna reiterated the importance of aligning the bank's growth trajectory with shareholder value, emphasizing the prudent allocation of capital and the gradual transition towards maximizing dividends for shareholders. In terms of market conditions and timing, Access Bank has been fortunate to have a loyal and committed shareholder base that has stood by the bank for the past two decades. This dedicated support has been evident in the response from both retail and institutional shareholders towards the ongoing capital raise. With a rights issue focused on existing shareholders, Access Bank aims to leverage the commitment and loyalty of its investor base to drive the success of the initiative. The bank's confidence in its shareholder base's commitment is unwavering, positioning Access Bank for a promising future as it embarks on a new phase of growth and consolidation.