Shareholders of Diamond Bank Plc Tuesday voted overwhelmingly in support of the plan by the bank to raise $750 million additional capital to enhance its operations and finance its business development initiatives.

The shareholders gave their support at the bank’s 22nd Annual General Meeting (AGM) held in Lagos.

The National Coordinator, Pragmatic Shareholders Association of Nigeria, Mrs. Bisi Bakare, while speaking at the meeting, expressed confidence that the funds would bring about improved benefits to shareholders.

Explaining the rationale behind the capital raising, the Group Managing Director/Chief Executive Officer, Diamond Bank, Dr. Alex Otti, while speaking with journalists, said: “What we are doing is to build a stronger bank so that we can pay better dividends in the future. Last year we got an approval at the AGM, just like today (yesterday) to raise $750 million in tier 2 capital. But what we have done today is to expand that, to say we can raise some in tier 2 capital and the rest in tier 1 capital which is equity.

“So what we did today was to vary the approval that we got. We intend to use it to expand our business, shore up our capital adequacy, to be stronger, expand our branches so that we can reach our customers easier.”

Otti revealed that $200 million of the proposed fund had been raised last year, saying that the financial institution intend to raise the remaining $550 million this year.

“We expect to build a stronger bank that would continue to push the frontier of micro, small and medium scale enterprises in the country and will continue to reach customers at the retail end of the market.

“We will keep doing the right things, we shall keep relying on our people, on technology, on skills and we shall continue to support industries. I believe that we will be able to sustain our performance going forward,” he added.

The 2012 annual reports and accounts showed that Diamond Bank returned to profitability in the year under review as it realised a profit before tax of N27.4 billion from a loss of N17.9 billion in 2011. It also showed that the bank’s gross earnings climbed to N112.3 billion in 2012.

Commenting on why the bank did not declare dividends in the 2012 financial year, Otti said: “We are looking for capital. We want the bank to grow to such a level where we can pay better dividend.”

Source: Thisday