First Bank Nigeria Says Foreign Units Adequately Capitalized

Foreign units of First Bank of Nigeria Plc, the country’s third-biggest lender by market value, are “adequately capitalized” and are not affected by a central bank rule that stopped lenders from funding offshore operations, Chief Executive Officer Bisi Onasanya said.

“In the unlikely event that we will be affected, we are looking at various options, including reducing dividend payout” in those units, he said today on a conference call from Lagos, Nigeria’s commercial capital.

Banks in Nigeria must obtain new funds to recapitalize their foreign units and won’t be allowed to use money already raised by their parent companies, the Central Bank of Nigeria said on July 26. Lenders that can’t raise additional capital for foreign subsidiaries “in the host market” will have to close the units, the Abuja-based regulator said.

First Bank holds a 75 percent stake in Banque Internationale de Credit, a lender in the Democratic Republic of Congo, and owns FBN Bank (UK) Ltd., which also has a branch in Paris, according to information on its website.

First Bank shares rose 3.2 percent to close at 12 naira in Lagos. The stock has gained 35 percent this year, compared with a 13 percent rise in the Nigerian Stock Exchange All-Share Index over the same period.

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