(Ecofin Agency) - Shareholders of BOA Côte d'Ivoire have approved a capital increase to CFA40 billion by incorporating reserves and issue premiums. This move aims to strengthen the bank's financial structure and support its growth.

On October 10, BOA Côte d'Ivoire’s shareholders gave the green light to a major capital boost during an extraordinary general meeting. The bank, a part of the pan-African BOA group, will double its capital from CFA20 billion to CFA40 billion ($33.3 million to $66.6 million). This will be done by incorporating reserves and share premiums, all without asking shareholders for additional funds.

The increase will come from incorporating CFA19.3 billion in optional reserves and CFA675 million in share premiums, as outlined in the approved resolutions. In simpler terms, the bank will create 20 million new shares, each valued at CFA1,000. Shareholders will receive one new share for each share they already own, completely free of charge.

The bank's management explained that this recapitalization will strengthen BOA Côte d'Ivoire’s financial base and help it achieve its growth goals in the fast-paced Ivorian banking market, one of the most dynamic in the region.

The new shares, set to be distributed free of charge, will come with the same benefits as the old ones, starting from January 1, 2024. However, there will be a stock price adjustment on the BRVM stock exchange, with the price being cut in half to reflect the increase in shares. For shareholders left with fractional shares, a special liquidity account will buy them back, ensuring smooth trading on the BRVM, where BOA Côte d'Ivoire is listed.

BOA Capital Securities, the group’s asset management arm, will oversee the entire process to ensure everything follows regulations. The operation is expected to wrap up in the coming months, once the necessary approvals are secured from authorities.

After the announcement, BOA Côte d'Ivoire shares continued their rise on the BRVM, reaching CFA10,290, up 2.9%. This followed strong first-quarter results where the bank’s net income jumped by 31.54%, and net banking income grew by 17.81%. The bank also expects continued strong performance in the upcoming quarters. Last year, net banking income grew by 27%, reaching CFA60.8 billion, while profit increased by nearly 30%, hitting CFA26 billion.