- The lender’s capital to total risk assets weighted ration is below the statutory minimum level
- The mid-sized lender has been seeking the debt funding from its top two shareholders
- The NSSF will provide Sh3 billion and the Treasury is expected to chip in Sh1.4 billion; prorated as per their shareholding.
National Bank of Kenya (NBK) #ticker:NBK expects to close a Sh4.4 billion shareholder loan by end of September to shore up its capital, which has remained below regulatory requirements for 15 months.
The mid-sized lender has been seeking the debt funding from its top two shareholders: National Social Security Fund (NSSF) and the Treasury, since June last year following the collapse of a planned Sh13 billion rights issue.
“We are engaging our shareholders. We have done presentations to them and hope to close this financing by end of third quarter,” said NBK chairman Mohamed Abdirahman Hassan after the lender’s annual general meeting held on Friday.
“We decided to look for debt as we wait for equity. On rights issue, we are waiting for the Treasury to sort out the matter,” said Mr Hassan.
The NSSF will provide Sh3 billion and the Treasury is expected to chip in Sh1.4 billion; prorated as per their shareholding.
The State-run pension scheme is the largest shareholder at NBK with a 48.05 per cent stake while the Treasury directly owns 22.5 per cent of the bank.
Shareholders Friday approved a bonus issue of one new share for every 10 shares held, a move which will see NBK inject Sh153.99 million in its operations from the reserves.