First Bank

[SavyInvestor]

Greeting all-It's nice to be back after a so long....

Would someone kindly tell us if there is any whisper within the institutions, on the level of allocation, investors are likely to receive following the blockbuster IPO.
Correct me if I am wrong N600 BILLION!!

[c kenneths]

Originally Posted by SavyInvestor

Greeting all-It's nice to be back after a so long....

Would someone kindly tell us if there is any whisper within the institutions, on the level of allocation, investors are likely to receive following the blockbuster IPO.
Correct me if I am wrong N600 BILLION!!

No news right now about the level of oversubscription, but if we take the previous happenings within the banks, they will likely absorb the excesses.but that also raise another question, won't the # of shares in circulation be too big? And how much more money will they need to make to satsfy the now enlarged # of shareholders. It bothers me a bit.

[RethinK2.0]

@ ckenneth

That shouldnt be much of a worry...
The scenario is that of a sound management.
The unbanked in Nigeria is huge.
Nigerian banks have little capacity to extend credit and end up helping local institutions to get credit from outside the country when the amount involved is too huge for the banks to carry.
There is also the scenario of possible mergers, muscle flexing (competition), possible takeover and a range of opportunities available to the bank.

If Intercontinental can survive 700% subscription, FBN will. Btw going by that line, FCMB, Fidelity, WEMA et al will have a harder task coping will 100BN of capital than FBN will at a possible as yet unconfirmed 600BN. The diff in the corresponding earnings.

How can a bank that has never made more than 5Billion in PAT survive with 100BN naira capital....?


But i believe with sound mgmt, all these banks will scale the hurdle. Its a gettin-bigger phase

[oseitutu]

RethinK2.0,
I agree with you to an extent. The second wave has just arrived. We will now begin to see monster corporations eating up smaller companies. The petty banks are about to be swallowed.....and it will be whether they like it or not. Real corporate take-overs. The other side of the coin is the banks have to work hard to be able to use the money they have picked up and will continue to pick up. If they fail, there will be instability. More money is available, more projects have to be financed so that more income will be generated.
Having said that, I do not see the rationale in approving absorbtion of more than 200% over subscription. The reason is that only the first 100% was stated in the prospectus so if FBN decides to go beyond that, what are they going to do with the money? Actually anything from importing cement to funding a war in a foreign land! (as ridiculous as they sound). They have not told 'over-subscribers' anything so they are covered. I think this issue of allowing over-subscription to be absorbed up to 600% should be stopped. It is not fair to share-holders, neither does it show responsibility on the part of the company raising the funds. Any plans they have for the new money will have been hurriedly put together and not based on sound evaluation and planning.
FBN big offer? Money should be refunded.

[RethinK2.0]

@ Oseitutu
Interesting days ahead indeed...

I agree that If FBN decides to return part of the oversubscribed funds, it would boost the value of the existng shares significantly too but the management must understand the situation in which they are playing. I think that the fact that Intercontinental was named best bank in Nigeria did not go down well with the Elephant (considering the rating was purely based on Tire1 Capital).

Meanwhile have you noticed the way Access bank MD, BOD and senior mgmt are busy canvassing for their offer?
From their tones and aggessive marketing, it is almost evident that they are looking for huge oversubscription too..GTb on the other hand were keen to avoid oversubscription of their GDR. Time will show which bank made the best move.

One thing is for sure, if any of them do become truly mega banks that can flex significant international muscle in the next 3-5years, shareholders will reap a windfall of returns .

The challenge is picking the right banks. (even though the minnows and smaller ones that will be taken over will most likely be taken over at a premium too). i remember i made a healthy sum from banks that no longer exist in the days of capitalisation.

[Geeman]

BUSINESS - Money - The Punch
The Management of First Bank Plc has announced that it will pay a dividend of N1 per share for the year ended, 31st March 2007.
In an unexpeted move, the bank has also announced that it will give a bonus share of 1 for every six shares held. This is coming on the heels of a bonus share of 1: 1 awarded by the Bank in 2006. However, only shareholders whose names appear on the register of the Bank as at 20 August, 2007 will benefit from the largesse. It is feared that persons who bought into the bank through the recent PO may not enjoy these as allotment may not be completed by that date. This is expected to lead to a bullish run for the bank stocks in the coming days as persons who want to enjoy these benefits will buy into the company.
Full details of this story can be found in the PUNCH Newspaper of 30th July, 2007
BUSINESS - Money - The Punch

[gloria]

pls who can tell me exactly, when first bank certificate will be issued out to investors.

[oseitutu]

It is now a race between these two entities. 100 kobo dividend, 1 for 6 vs 1 for 4 (see entry here)Zenith Bank may be able to match FBN if they play their cards right, however, at the moment, FBN rules!

[anekwlc]

Originally Posted by oseitutu

It is now a race between these two entities. 100 kobo dividend, 1 for 6 vs 1 for 4 (see entry here)Zenith Bank may be able to match FBN if they play their cards right, however, at the moment, FBN rules!

I do not think Zenith will get close to FBN. I should expect the price to go bellow GTB price after mark down. FBN and GTB has been consistence in rewarding investors.
To me Zenith has not been profitable apart from current price appreciate because of Bonus remour. I am on my way out. Even UBN has been more rewarding.

[tsho]

i learnt 1st bank was over-subscribed, what's going to happen,

[olusolakemmy]

Originally Posted by tsho

i learnt 1st bank was over-subscribed, what's going to happen,

if 1st bank is oversub, they will likely return excesses to investors, considering the fact that they will have excess shares due to the bonus and hybrid offer, they will likely not absorb excess subscribtion.

so on quota basis, they will return investment, may be those that subscribe for lowunit will get everything while people that bought lots will be cut down

[shigidi]

hey all. how far do u think the first bank run can go. any1 feel it can hit 70 b4 it starts to fall again???

[c kenneths]

Originally Posted by shigidi

hey all. how far do u think the first bank run can go. any1 feel it can hit 70 b4 it starts to fall again???

Well todays price added another 2.57k to the surging price and its likely to continue on that note as much as the next three days, all things being equal.It may blow past 60, but 70 is anyones guess since speculators that have made around 20 percent in the last three weeks will be selling like mad.

[shigidi]

i was actually trying to get some once the suspension was lifted but my broker tells me its unavailable. im also concerned about all the extra shares, surely the eps is gonna fall and that aint too good from a fundamentals point of view

[oseitutu]

My prediction is that FBN will expand its business further and eat up other smaller businesses. It may not necessarily be banks. It could be insurance companies or building/mortgage companies. It could even target and eat stock brokerage firms. That way, as they try to exhaust banking business avenues, they also find extra-banking activities to make money.

[Godson69]

Hey following the trend I am inlined to assert that FBN may hit N70 or even more because it has proved to be the most rewarding investment with less risk compared to other banks for instance with ZBN you cannot predict your growth or losses especially with this wild fire thing. FBN next year na me an u

[Yusuf]

From my own analysis, First Bank can go places. Who say the stock cannot appreciate maximally with 5% on daily trading days till 20th August. See the analysis below

DAYS DATE OPENING CLOSING
Thursday 8/2/2007 54.11 56.82
Friday 8/3/2007 56.82 59.66
Monday 8/5/2007 59.66 62.64
Tuesday 8/6/2007 62.64 65.77
Wednesday 8/7/2007 65.77 69.06
Thursday 8/8/2007 69.06 72.51
Friday 8/9/2007 72.51 76.14
Monday 8/11/2007 76.14 79.95
Tuesday 8/12/2007 79.95 83.94
Wednesday 8/13/2007 83.94 88.14
Thursday 8/14/2007 88.14 92.55
Friday 8/15/2007 92.55 97.17
Monday 8/17/2007 97.17 102.03
Tuesday 8/18/2007 102.03 107.13
Wednesday 8/19/2007 107.13 112.49
Thursday 8/20/2007 112.49 118.12

Though this is theoretical but it shows that it is very possible the stock goes places. For investors that want to cash-in on the bullish trend, they should be ready.