The stocks of financial institutions experienced a notable uptick in value on the first trading day after the Central Bank Governor, Dr. Olayemi Cardoso, announced that Nigerian banks would need to recapitalize in preparation for servicing the projected $1 trillion economy outlined by President Bola Tinubu.
During the 58th annual Bankers’ Dinner, Cardoso revealed that a stress test conducted on Nigerian banks indicated their strength under mild-to-moderate economic and financial stress.
However, he emphasized the necessity for further strengthening and resilience enhancement to effectively serve a $1 trillion economy.
This announcement stirred reactions in the market, prompting investors to reassess their positions.
On Monday, First Bank of Nigeria Holdings (FBNH) led the gainers’ chart with a remarkable 10% increase, closing at N22 per unit—the highest level reached so far this month.
FBNH has already disclosed plans to raise fresh capital through a Rights Issue, prompting investors to strategically position themselves ahead of the issue’s commencement.
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Sterling Financial Holdings Company also witnessed a gain of 5.07%, closing at N3.73, a notable high compared to its recent performance.
Access Holdings Plc saw a 4.32% increase, closing at N18.1, while Zenith Bank shares rose by 1.73%, closing at N35.3 per unit.
FCMB shares appreciated by 1.46%, reaching N6.95 per unit, with a total of 14,950,665 units exchanged in 115 deals.
United Bank for Africa (UBA) rounded off the list of banking stocks on the gainers’ chart with a 1.44% increase.
Notably, 30,306,403 million units of UBA shares, valued at N646.18m, were exchanged in 517 deals.
Banking stocks dominated the volume and value drivers on the NGX, led by stocks of AccessCorp, UBA, and Zenith Bank, signaling a renewed investor interest in the banking sector.
As banks gear up for recapitalization, the Nigerian financial market appears poised for increased activity, reflecting investor confidence in the sector’s ability to navigate future challenges and contribute to the realization of President Bola Tinubu’s ambitious economic targets.
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