Shareholders of Union Bank of Nigeria Plc yesterday approved the proposal by the board of directors for a N54.4 billion reduction from the bank’s Share Premium Account in a bid to restructure its balance sheet for optimal performance.
The shareholders endorsed the move at an Extra-Ordinary General Meeting (EGM) in Lagos.
The directors had said the bank’s financial position as at December 31, 2018 indicated a deficit of N54.458 billion, representing accumulated permanent losses from legacy transactions. And in a bid to offset the negative retained earnings, the directors proposed the Share Premium Reduction in accordance with sections 106 and 107 of Companies and Allied Matters Act (CAMA).
The directors said the transaction, which was subject to confirmation by the Federal High Court, would have no impact on the bank’s creditors or its shareholders’ funds but instead, is expected to pave the way for the payment of dividends to shareholders.
Commenting on the development, the Chairman of the Board of Directors, Mr. Cyril Odu, said the bank’s focus on the delivering of value to its stakeholders.
He said: “Union Bank is on course towards delivering its 2019-2021 strategic objectives. As we continue our push towards being Nigeria’s most reliable and trusted banking partner, we remain focused on improving the profitability of our business and delivering value to all our stakeholders – shareholders, customers, business partners and employees.”
Meanwhile, the equities market continued with its losing streak as the Nigerian Stock Exchange (NSE) All-Share Index fell by 0.70 per cent to close lower at 30,099.83, while market capitalisation shed N97. 9 billion to be at N13.3 trillion.
As a result, the year-to-date (YTD) decline worsened to 5.6 per cent.
A total of 10 stocks appreciated, while 15 stocks depreciated. Unilever Nigeria Plc led with 8.2 per cent, Associated Bus Company Plc trailed with 7.1 per cent, while Jaiz Bank Plc gained 4.3 per cent.
Conversely, Sovereign Trust Insurance Plc led the price losers with 8.0 per cent, followed by Japaul Oil and Maritime Services Plc with a decline of 7.4 per cent.
However, activity level was mixed as volume traded declined 5.6 per cent to 233.5 million shares while value traded rose 1.0 per cent to N3.5 billion.
WAPIC Insurance Plc (50.3 million units), Zenith Bank Plc(28.2 million units) and Courtville (25.2 million units) were the top trades by volume while MTN Nigeria (N1.5 billion), Nigerian Breweries Plc (N764.2 million) and Zenith Bank Plc (N566.5 million) led the top trades by value.