By JONAH NWOKPOKU
Sterling Bank Plc has commenced a capital raising exercise aimed at increasing its market share in the banking industry.
The first step in this regard is a Rights Issue of N5, 888, 949, 162 ordinary shares of 50 kobo each at N2.12k per share. According to the rights circular made available at the company’s completion board meeting held in Lagos, the offer is on the basis of three new ordinary shares to every eight ordinary shares of 50 kobo each held as at May 20, 2013. The offer will open next week Monday and close 31st July 2013.
Addressing journalists at the end of the meeting, Managing Director/CEO, Dr. Yemi Adeola said “We need to establish more branches, we need to improve on our technology infrastructure to enable us pursue our retail banking strategies. We have a design that is unmatched in the industry as far as retail banking is concerned. We need to put enabling infrastructure in place to enable us move to the next level. We can also do more with banking customers’ market.”
He said that the bank’s focus is on expanding more into the Nigerian market, saying the bank has no immediate plans of expanding overseas in the near future. “Expanding off shore is not our interest right now. Nigeria market is huge and it is important to have our footprint all over Nigeria first before we start thinking offshore,” he said.
Speaking further he said, “This is the beginning of our capital raising journey. We stated during our last general meeting that we will embark on this journey. First of all, we agreed to do $200 million, Rights Issue, which is being ratified today, and a balance of $120 million, by way of private placement.
And then we will raise tear two capital of $200 million towards the end of the year. This is key because we have run this bank from a modest capital of N25 billion in 2006 when we merged to slightly over N40 billion today, without calling on any of our shareholders to bring money.”
He noted that the bank is one of the few financial institutions that has not raised capital in seven years and has no regrets whatsoever at this moment embarking on the process of raising additional capital.