Companies

Family Bank to double issued shares after stock split

BD Family Bank 1501 px

Customers queue for service at a Family Bank branch in Nairobi. The bank is set to double its issued shares after effecting a one-for-one split. PHOTO | FILE |

Family Bank is set to double its issued shares after effecting a one-for-one split that is expected to increase the liquidity of its stock by lowering their unit costs.

The bank, which had 557 million issued shares as at the end of last year, is set to seek shareholder approval for the proposed split at an extraordinary general meeting to be held next month.

Shareholders, whose funds in the bank grew 23 per cent to Sh6 billion in the year to December will, during the EGM, also be expected to give their greenlight for a rights issue whose targeted value is however yet to be made public.

READ: Family Bank in plans for another rights issue

“On the recommendation of the Board of Directors, and subject to shareholder and regulatory approvals, the issued shares of the company be split in the ratio of 1 for 1,” a press notice by the bank reads in part.

“...the holding of those persons or entities shown in the register as members of the company as at the close of business on 26th September 2014 shall be adjusted proportionately to reflect the split…”

Bonus issue

This share split follows a bonus issue that the bank effected last year and which increased its fully paid up shares from 278 million to the current Sh578 million, against a total of 750 million authorised ordinary shares.

Four years ago, the bank split its shares by two-and-a-half times, in a move that preceded its maiden rights issue.

The latest split will see the par value of each share halve from Sh2 to Sh1 for every ordinary share.

Family Bank, which started in 1984 as a building society before converting into a fully fledged commercial bank in May 2007, has been eyeing listing on the Nairobi Securities Exchange (NSE) through an initial public offering.