CRDB Bank Right Issue Gets Impressive Success

CRDB right issue has been subscribed successfully by full amount thanks to three underwriters who bought the remaining amount.

The bank in June 26, staged the right issue in a bid to raise slightly over 150bn/- to finance the firm’s expansion drive and meeting the regulator’s minimum core capital requirement.

The bank’s shareholders bought 70.5 per cent of the share at a price of 350/- a stock leaving the rest 29.5 per cent to underwriters.

The CRDB Bank Managing Director, Dr Charles Kimei, said the right offer exercise was successful as shareholders purchased 306,833,746 shares.

“We have reached our targeted goal by hundred per cent. This is a great success,” Dr Kimei told a news conference. He added: “At the moment the bank has finalised listing of the said changes in shares on Dar es Salaam Stock Exchange (DSE) as per regulations.”

The exercise of updating shareholding status at the bourse is expected to end on Wednesday. The underwriters — CDC Group Plc, International Finance Corporation (IFC) and Africa Capitalisation Fund Ltd — gave a 32/- per share for those who failed to buy thus maintained a 100 per cent subscription of 435.5 million shares.

The bank expects another robust performance in the second half of the year, after a better first half thanks to a recent expansion drive and marketing mix.

In this year’s first half, CRDB posted a pre-tax profit of 92.5bn/- up from 58.81bn/- of the same period last year.

The CRDB share price in the week ended last Friday appreciated by 1.25 per cent to 405/- a piece. During the week the counter moved 1,107,719 shares.

“This week (last week) CRDB counter was the most active counter on the banking segment,” Tanzania Securities said in a weekly report.

Earlier, the Orbit Securities Chief Executive Officer, Mr Laurian Malauri, said brokers were pushing the right issue sale to at least 95 per cent and let the underwriters to remain with 5.0 per cent.

“The previous (CRDB right issue in 2007) sale was 80 per cent, this one we (stock brokers) want to achieve 95 per centÉ as if we fail to sell, most of shares will be locked to underwriter,” Mr Malauri said.

Orbit is sponsoring brokerage firm. The Orbit CEO said failure to maximise sale will reduce liquidity circulation at stock market hence are out to make sure the right issue maintains good sale.

The workshop idea was to enable LGAs understand CRDB services which are tailor made for them. To bring banking services closer to its customers, CRDB has 123 branches, 1,500 agency banking under FahariHuduma, 400 ATMs and over 900 Point of Sales across the country.

Originally published by DailyNews Tanzania

You may also like

Popular News