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Foxxymobile Street Insider | Winners Vs Losers — Bank Recap Heat
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35 days agoFoxxymobile Street Insider | Winners Vs Losers — Bank Recap Heat
Nigerian banks are rushing to bulk up capital before the CBN recap deadline (2026). Fresh equity raises, IPO moves, and rights issues are flying — but EPS dilution risk is the shadow in the room.
Winners
Sterling Bank → Eyeing a public offer in Sept 2025, signaling it’s ready to play in the big recap league.
FCMB Group Plc → Green light from shareholders for an equity raise/IPO. IPO buzz + compliance brownie points.
Jaiz Bank Plc → Targeting ₦150bn capital. Clear compliance + Islamic finance growth narrative intact.
CBN Recap Push → Forces banks to strengthen balance sheets, clean up Stage 2 loans, and restore confidence.
Losers
EPS (Earnings Per Share) → More shares in issue = thinner EPS. EMIU expects a drop by Dec 2025.
Investors chasing yield → Higher P/E ratios (2.6x vs 3-yr avg of 2.2x) = valuations stretched, less bargain hunting.
Stage 2 Loan Forbearance → Fitch says the party ends in 2025 → some loans could get reclassified as impaired.
Short-term portfolios → Forced to rebalance as future P/E projections diverge from trailing 12-month comfort zones.
Takeaway: Banks are racing the recap clock. Capital raises = compliance win, but investors must weigh dilution vs long-term growth. 2025 could test whether fresh equity translates to real value.