NAIROBI, Kenya, May 4 – Diamond Trust Bank (DTB) shareholders have approved a planned Rights Issue during the bank’s Annual General Meeting held on Friday.
By June this year, the bank intends to offer 24.4 million shares subject to the market regulator’s approval, with the hope of raising Sh1.8 billion.
The bank’s chairman Abdul Samji says the additional capital raised will be used for expansion programmes in Kenya and strengthening its presence in the East Africa region.
DTB plans to venture into Rwanda, South Sudan, the Democratic Republic of Congo and Mozambique.
“Very soon the application will go to the Capital Markets Authority for them to approve this Rights Issue. Once the approval is done, the board will look at the price, which is going to be something both the shareholders and the board are comfortable with,” Samji said.
However, shareholders will be given the opportunity to take up their rights at the ratio of one new ordinary share, for every eight shares held.
DTB Managing Director and Chief Executive Officer Nasim Devji said some of the amount will also be used to invest in technology and other customer service products.
In 2006 and 2007, the DTB group increased its capital base through two successive rights issues, where the bank raised Sh2.4 billion.
Last financial year, DTB announced a pre-tax profit of Sh4.3 billion and recommended a dividend of Sh1.70 per share.
The bank has subsidiaries in Uganda, Tanzania, and Burundi.