Union Bank to write off N248bn accumulated losses

Union Bank of Nigeria (UBN) Plc plans to use part of the balance in its share premium account to write off about N248 billion deficit in its general reserve as the 100 years old bank begins to prepare for resumption of dividend payment.

The deficit accumulated from many years of losses as the old generation bank struggled to regain its footing.

At the annual general meeting in Lagos, shareholders approved special resolutions authorizing the board of directors to reduce the N391.64 billion in the bank’s share premium account by N247.87 billion and apply same to write off deficit of N247.87 billion on the bank’s general reserve as at December 31, 2016.

Under the extant rules, a company with deficit in general reserve cannot make dividend payment even though its earnings in the current year may be sufficient to make such distribution.

Read also: FG releases N30bn to develop solid mineral sector

Union Bank also said it has advanced arrangements to roll out its N50 billion rights issue. The rights issue is expected to be floated within the next eight weeks.

Chief executive officer, Union Bank of Nigeria (UBN) Plc, Mr. Emeka Emuwa, said the bank would launch the N50 billion rights issue this quarter, referring to between May and June 2017.

He said the net proceeds from the new issue would be used to support the acceleration of the bank’s growth.

Emuwa added that the additional funding will also allow the bank to maintain compliance with regulatory capital requirements.

“We have since commenced all necessary steps for a successful rights issue and expect to launch by the second quarter of the year,” Emuwa said.

According to him, the bank would maintain focus on growing its retail business while also growing its commercial and corporate businesses.

 

RipplesNigeria ….without borders, without fears

Click here to download the Ripples Nigeria App for latest updates

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now