Investors in the market need to watch what insiders are doing and there is no clearer picture about the direction of FBN Holdings (owners of First Bank) shares, than the signal the Group Managing Director (GMD) U.K. Eke is sending with his recent purchases of the banks shares.
The GMD in another iteration of his conviction buy on FBN Holdings shares has purchased some 15 million worth of the bank’s shares at an aggregate price of N5.67 per share, according to a filing on the Nigerian Stock Exchange (NSE).
This means Eke spent a total of N85 million in the recent transaction, which occurred on May 27, 2020 (this week).
MoneyCentral had earlier reported that Eke’s direct holdings of FBN Holding shares was the only one to grow significantly in the past year from 22.4 million shares at the end of 2018, to 65.1 million shares at the end of 2019, according to data from FBNH financial statements.
In essence Eke grew his holdings by 42.7 million shares in a one-year period.
With FBNH share price averaging an average of N6.4 in 2019 it means that the FBNH GMD spent about N273 million in acquiring the shares. Eke the GMD might however be on the right track with his purchases. MoneyCentral reported this week that FBH Holdings was on track to retake its number one crown among Tier-One lenders in the country.
In Q1 2020, FBNH reported a 5.85 percent increase in Profits Before Tax to N28.7billion in its unaudited results, as Non-interest income jumped 83.15 percent.
FBN Holdings closed at N5.35 on Friday and the shares have returned -17 percent in the past year.
Investors should probably give themselves an edge by following the smart money which Eke’s purchase represents, even though we are unable to ascertain his timeline for the trade to pay off.