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Abil shares 38% cheaper

Johannesburg - Mass-lender African Bank Investments [JSE:ABL] (Abil) said on Friday it would be issuing 685.3 million new ordinary shares at a discount of 38.72%.

The bank plans to raise R5.5bn at a subscription price of 800 cents per rights offer share.

Shareholders can exercise rights at 84 new shares for every 100 held, Abil said in a filing to the Johannesburg stock exchange.

Abil said the International Finance Corporation had committed to underwrite 75 million of the new shares. Goldman Sachs is underwriting the whole issue.

The lender also said headline earnings for the 11 months to end-August fell 88 percent despite interest income jumping nearly 24% to R10.98bn.

Last week, the bank warned full-year headline earnings were likely to be as low as 37 cents a share, down from 378.2 cents a year earlier. Headline EPS, the main measure of profit in South Africa, excludes certain one-time items.

Credit impairments widened 87% to R8.27bn in the first 11 months, the company said, while its furniture retail unit, which it is trying to sell, generated a loss of R226m.

Its shares were down 2.7% at 18:55 at 10:25, after dropping more than 5% in earlier trade.
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