By Peter OBIORA InvestAdvocate

Lagos (INVESTADVOCATE)-Sterling Bank Plc signed a Transaction Implementation Agreement (TIA) with Equatorial Trust Bank (ETB) in order to acquire the Rescued Bank. Sources close to Investadvocate confirmed this Thursday August 11 2011 in Lagos Nigeria.

Our Source also affirmed that the Central Bank of Nigeria (CBN) and the Asset Management Corporation of Nigeria (AMCON) are privy to the transaction and have given their approval.

Also, it’s been confirmed that Mike Adenuga, Founder of ETB and the entire Board of the Bank has also given their approval to the deal.

This is coming on the heels of earlier Agreements signed by four of Rescued Banks the past few weeks, these Banks include Finbank Plc (Finbank), Intercontinental Bank Plc (IBPLC), Oceanic Bank Plc (Oceanic) and Union Bank of Nigeria Plc (UBN) who signed similar agreements with potential buyers.

Sterling Bank until recently was considered an attractive front-row partner to Foreign Financial Institutions seeking to enter into Africa’s fastest growing Financial Services Market.

This deal signed Thursday August 11 2011, marks an end to speculation on Sterling Bank’s varied strategic growth options as it finally opts for domestic consolidation over foreign dominance.

InvestAdvocate gathered that the Sterling Bank-ETB talks was driven by clear strategic considerations on the post-deal benefits for both sides, “the urgency introduced by the Nigerian Deposit Insurance Corporation’s (NDIC)’s nationalisation of three Banks aside, this is a very well thought out deal that would yield impressive returns on equity for years to come” a Source affirmed.

According to our Source, the combination of both Banks, which are matched in many ways, would create an institution with over N360 billion in customer deposits, N550 billion in assets and more than 185 operational branches across Nigeria.

As at the time of filling in this Report, the financial terms of the deal are yet to be made available. However, Industry Watchers expect that the Transaction Agreement will move to a substantive level without the distractions of litigations filed by Minority Shareholder of ETB.

ETB is a privately held Bank and is not listed on the Nigerian Stock Exchange NSE. While Sterling Bank’s shareholders welcome the deal as an historic opportunity to substantially scale up its Assets and operations, coupled with benefits from the cost savings to be derived from the merger’s synergies.

Also, a Shareholder of Sterling Bank name (withheld) affirmed that the Bank enjoys excellent tradition from key players in Telecoms and Petroleum Marketing sector of the Nigerian economy; which is good to bring to the fore. “Without doubt, the deal would be a very positive one for the Nigerian Banking Sector” the Shareholder said.

This is coming on the heels on Friday August 05 2011 the Nationalisation of three Rescued Banks which include Afribank Plc as Mainstreet Bank Limited, Bank PHB Plc as Keystone Bank Limited and Spring Bank Plc as Enterprise Bank Limited.

The Nigeria’s Central Bank has given up till September 2011 end for the Rescued Banks to recapitalise or face liquidation.