Ghanaian Investor Daniel Ofori’s Bank Announces $45M Rights Issue to Boost capital

CalBank Plc (CalBank), a significant commercial bank in Ghana partly controlled by Daniel Ofori, the richest investor on the Ghana Stock Exchange, has received authority to raise funds through a rights issue.

The Accra-based lender, founded in 1990, is giving existing shareholders the option to buy additional ordinary and preference shares at a set price of GHS0.29 per share, for a total offering of GHS600 million ($45.28 million).

The rights offer will result in the issuance of 1,872,461,736 ordinary shares and 196,503,781 preference shares.The bank has declared that existing shareholders on the record date would have preferred rights to purchase additional shares in proportion to their current holdings, allowing them to keep their ownership percentage following the capital rise.

The rights sale, approved by CalBank’s board and shareholders at the June 8, 2023 Annual General Meeting, intends to strengthen the bank’s regulatory capital position while also fueling its expansion strategy. The offer period begins on April 5 and ends on April 26, 2024.

Existing shareholders on the record date (April 3, 2024) will be able to purchase new shares proportionate to their current holdings, allowing them to keep their ownership interest following the dilution.

The proceeds from the rights offering will be used to boost CalBank’s capital adequacy ratio, a fundamental criterion that measures a bank’s financial soundness. A larger capital basis enables CalBank to absorb any losses while also supporting future lending, ultimately placing the bank for long-term success in the Ghanaian market.

CalBank, founded in 1990, provides financial services to a wide range of clients, including corporations, high-net-worth individuals, NGOs, SMEs, and retail customers. Daniel Ofori, a prominent Ghanaian businessman, owns a 3.9 percent stake in CalBank.

Ofori, who founded Ghana’s top garment retailer White Chapel Ltd., is the chairman and CEO of White Chapel Holdings. He serves on the boards of several firms. White Chapel Holdings is the parent business of White Chapel Ltd.

The successful conclusion of the rights offer would provide CalBank with the financial freedom it needs to execute its expansion strategy and strengthen its position as a market leader in Ghana’s banking sector.

Written by PH

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