Nedbank wants to buy back preference shares - here's why more companies are ditching them

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Nedbank says it is considering making an offer to all its preference share investors.
Nedbank says it is considering making an offer to all its preference share investors.
Gallo Images/Financial Mail/Russell Roberts

Nedbank is the latest bank to join a growing list of finance houses and other companies who want to ditch preference shares. The bank announced on Tuesday that it is considering buying back all of its issued preference shares.

It said it wants to make an offer to all investors who have these shares, a move that sent the banking group's share price up 13% following the announcement.

If the majority of Nedbank's preference shareholders agree, the bank will join the likes of Capitec, PSG, Hudaco, and Northam, which has acquired all Zambezi preference shares it issued in 2015.

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