Market Upgrades Unity Bank Valuation by 57%
Unity Bank Plc’s share price has been gathering energy from increased demand by Alpha seekers taking position amidst an unconfirmed Merger and Acquisition deal.
The bank share price climbed by 57% in five trading sessions due to heavy positioning. As of Friday, equities investors in the Nigerian Exchange placed about N22 billion as market valuation on the bank.
This showed renewed interest supported by positive expectations about the financial institution’s future earnings stream. Unity Bank Plc’s market capitalisation had dropped to N11 billion despite booming stock market performance.
In a swift reaction to a probable merger and acquisition deal with Providus Bank Limited, there has been a sporadic surge in demand for Unity Bank Plc. The bank had started injecting capital to strengthen its position before its weak earnings performance in the third quarter of 2023.
In the first half of 2023, the bank received additional capital of N135 billion, which then moderated its negative shareholders’ fund from N275 billion in December 2022 financial year-end to N178 billion at the end of June 2023.
This happened after the bank absorbed its FX revaluation loss suffered in the second quarter of the year. The devaluation of the local currency in June triggered a new challenge for the bank with foreign currency liabilities. Naira Devaluation Deepens Economic Crisis in Nigeria