The former chairman of First Bank, Oba Otudeko and the Group Managing Director of the bank, Urum Eke, lost a combined N608.32 million in one day to the lender’s short position investors.
Stakeholders lost N34.10 billion to investors taking out their investment, causing the total investment in First Bank to plunge by 7.47 percent, Ripples Nigeria analysis showed.
Backstory to the losses
The fourth quarter of 2021 has been the best in recent quarters for First Bank, as investors renewed their interest in the bank improving its investibility and setting off a price bubble in October.
Throughout the nine months of this year, First Bank stock was sluggish, valued between N7.15 per share and N7.55 kobo September 28, before it finally broke the ceiling to trade at N8.05 a day after.
Between January and September, First Bank market value appreciated by 12.5 percent, reflecting the dampening mood of the Nigerian bourse triggered by the Central Bank of Nigeria’s reopening of the OMO market and increased interest to lure investors back.
The slow growth pushed its market value to N288.95 billion by end of last month, against the N256.65 billion it was worth in January.
However, investors’ confidence in First Bank in Q4 saw the market price rise by 57.7 percent in two weeks of October.
Breakdown of Otudeko, Eke’s losses
The 57.7 percent gain lifted the market value to N455.87 billion by Friday, October 15, as the market price jumped from N8.05 to N12.7kobo per share, however, on Monday, investors engaged in profit-taking, knocking First Bank value down by 7.47 percent.
The sell off on Monday cost holders of First Bank shares a whooping N34.10 billion following the decline in the total investment value of the Nigerian lender.
One of the notable names impacted is the former chairman, Oba Otudeko, who has a total of 537.9 million shares (5.89 million direct shares and 532.07 million indirect shares).
He lost N511.07 million from his investment in First Bank, which dwindled to N6.32 billion on Monday, from the N6.83 billion of last week Friday.
The Group Managing Director, U.K Eke, who accounts for 102.37 million direct shares in First Bank as of June 2021, lost N97.25 million, as his investment plunged to N1.202 billion from N1.300 billion.
