UBA Targets Additional N157bn in Rights Issue, Extends Recapitalization Push Amid Strong Q1 Earnings

United Bank for Africa (UBA) PLC intensifies efforts to strengthen its capital base, announcing a new plan to increase more than 157 billion Nairas thanks to a question of rights within the framework of a wider strategy to respond to the mandate of recapitalization of the Central Bank of Nigeria (CBN).

This decision highlights the urgency among Nigerian banks to comply with the Apex bank directive, which aims to fortify the country’s financial sector against economic shocks and the volatility of the frames.

In an opinion to negotiation licenses, Nigerian Exchange Limited (NGX) revealed that UBA, through its UNITED Capital Securities Limited stock broker, filed a request for approval and registration of 3,156,869,665 ordinary shares of 50 kobo each. The question of rights, at the price of N50.00 per share, will be offered on the basis of a new action for each thirteen ordinary shares held by shareholders from July 16, 2025.

This last offer is the second capital increase in UBA in a year. In November 2024, the lender had launched a rights issue to increase 239.4 billion Nairas thanks to the sale of more than 6.8 billion shares to N35.00 each. This offer was overwritten, with offers exceeding 251 billion nairas. However, in accordance with its ceiling, UBA accepted 240 billion Nairas, bringing its capital base to 355.2 billion Nairas – of course to respect the new regulatory minimum.

The latest efforts will also fill the capital gap, because UBA aims to fully comply with the deadline for recapitalizing the CBN on March 31, 2026. Under the policy introduced by the CBN in March 2024, commercial banks with international licenses are required to raise their minimum capital to 500 billion Nairas, while national banks must increase the north of N200 billions and regional banks n50 billion nairas. The calculation of the capital excludes the profits preserved, the share premium and re -evaluation reserves, which means that banks must increase new equity to reach the threshold.

Politics, described by CBN as a decision to “strengthen the resilience of the Nigeria banking system”, has been motivated by concerns concerning the depreciation of Nairas, high inflation and an increase in macroeconomic risks. Many banks, including UBA, have since adopted progressive recapitalization strategies combining rights of rights, public offers and, in some cases, mergers or acquisitions to achieve the objective.

The recapitalization course of the UBA was reinforced by its strong financial performance. For the first quarter of 2025, the bank posted a profit before tax of 204.27 billion Nairas – an increase of 30.65% compared to 156.3 billion nairas during the same period last year. Net profit reached 189.84 billion nairas, reflecting growth of 33.15% in annual shift. These profits were fed by solid interest income, which climbed to 599.83 billion Nairas, up 36% compared to T1 2024. The majority of it came from loans and advances (260.56 billion Nairas) and investment titles (291.86 billion).

Non -interest income has also increased, electronic banks generating 47.84 billion nairas and account maintenance costs contributing 10.39 billion Nairas. The bank’s assessment continues to reflect the operational force, with strategic investments in technology and expansion in the main paying African markets.

The increase in UBA continuous capital reaffirms its commitment to maintain its international banking license and to support its Pan -African footprint. For shareholders, the latest rights issue offers another opportunity to deepen their equity in one of the main financial institutions in Nigeria, even if the industry approaches a new era of adequacy and capital competition.

As the deadline for recapitalization approaches, UBA – like many of its peers – seems to run against time. Already, several banks, including Zenith, GTCO, Access Holdings and FBN Holdings, have unveiled similar plans, issuing public offers and rights, pointing to a wheelbarrow at the sector to meet CBN’s requests.