Posted by By OMODELE ADIGUN on
Shareholders of Sterling Bank Plc on Wednesday gave the bank the go-ahead to raise N75 billion from the investing public through a hybrid offer. Majority of the shareholders who spoke at the bank's 46th Annual General Meeting in Lagos were of the view that the bank should beef up its capital base so as to meet the present challenges in the industry.
Shareholders of Sterling Bank Plc on Wednesday gave the bank the go-ahead to raise N75 billion from the investing public through a hybrid offer. Majority of the shareholders who spoke at the bank's 46th Annual General Meeting in Lagos were of the view that the bank should beef up its capital base so as to meet the present challenges in the industry.
According to Chief Timothy Adesiyan, president of Shareholders Association of Nigeria, there is need for the bank to recapitalise considering the enormous challenges in the financial industry in recent times.
"We just have to recapitalise, by taking money from the public so as not to be starved of funds for our operations."
It would be recalled that the bank planned to raise N75billion through public offer and Rights Issue for its existing shareholders. This necessitated the technical suspension placed on its stock price by the Nigerian Stock Exchange (NSE) since 2007.
Commenting on this issue, Sterling Bank's Managing Director, Mr. Yemi Adeola, assured the shareholders that the bank would go to the capital market at a time that would be beneficial to the investors, not when they would lose their money. On the issue of merger, he explained that the bank is stable with determined management and board to give returns on investment, saying "it doesn't make sense to go into any merger arrangement this time when we have a bank that can run on its own and performing well. Business exigencies may dictate that we do that in future, we can't rule out that in this environment. If we are to do that, we will do it on a higher scale and that may see us acquire a lesser partner."
The Chairman of the bank, Dr. S.A Adegunwa told the shareholders that the bank recorded an impressive performance in 2007. According to him, the bank as at September 30 2007, increased its gross earnings by 87 percent from N12.8 billion to N23.9 billion. Profit after tax grew from N1 billion to N1.9 billion, representing 90 percent growth while the total balance sheet and contingencies increased by 45 percent from N144 billion to N210 billion.