By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)-Nigeria’s mid-tier lender, Sterling Bank Plc will add 30 new branches to its network before the end of 2014, Abubakar Suleiman, chief financial officer (CFO) of the bank disclosed to InvestAdvocate via an e-mail.
Suleiman made this disclosure while responding to request for clarification on the status update of the usage of the N12.5 billion the lender raised January this year, Sterling Bank had said it will invest proceeds from the rights issue in information technology (IT), distribution outlets and alternative delivery channels.
‘’We are adding more than 30 branches to our network this year and we have grown our asset base considerably as shown in our third quarter report,’’ Suleiman said.
He affirmed that there are ongoing technology projects the bank is embarking on and will be announcing new initiatives shortly. ‘’In addition, we have doubled our ATMs in less than one year,’’ the Sterling Bank’s CFO added.
Currently, the corporate information available on the website of the bank shows that it has 168 business offices; 205 ATMs.
A recent report has it that the lender has opened 10 new branches in line with its focus on the retail end of the market and its quest to deliver quality services to the doorsteps of its customers, with the 168 branches and the 10 recent additions, Sterling Bank’s branch networks has now hit 178.
Similarly, the bank said it has embarked on the remodeling of about 40 of its branches to reflect its retail positioning.
Suleiman also responded to comments that feelers from some quarters are of the opinion that Sterling bank is seeking to shore up its capital base which may be perceived to be weak and to at least meet up regulatory requirements.
He said it’s not an informed position given the number of financial institutions globally that are in the process of raising additional capital. ‘’I suspect ‘those quarters’ have not evaluated the impact of the adoption of Basel 2 capital criteria by Nigerian banks,’’ the lenders CFO said.
The lenders balance as at end current period -September 30, 2014 shows that total equity stands at N65.055 billion and share capital N10.796 billion.
Also, net assets of Sterling Bank climbed up 21.31 percent to N782 billion from N644 billion in the corresponding period of 2013.
The central bank of Nigeria (CBN) on December 2013 issued circular to Nigerian Banks on the implementation of Basel 2 and 3 where it retained the minimum capital requirement at 10 percent and 15 percent respectively for local and international banks
The CBN directed that banks are expected to commence a parallel run of both Basel 1 and 2 minimum capital adequacy computation based on set out requirements with effect from January, 2014. While the minimum capital adequacy computation under Basel II rule commenced in June.
The CBN however, extended its implementation for an additional period of three months and directed its full adoption would commence October 1, 2014.
A further review of the statement of comprehensive income for the period, shows that profit after tax grew 39.19 percent to N7.063 billion from N5.074 billion recorded in the Q3 of 2014.
Pretax profit also rose 41.32 percent to N8.502 billion from N6.016 billion in the same period of 2013.
Gross Earnings increased from N65.120 billion in the Q3 of 2013 to N73.005 billion in the review period of 2014; indicating a rise of 12.11 percent.
Shareholders of the lender are expected to meet on November 11 to deliberate and approve N19.8 billion ($200 million) fresh capital drive via a special or private placement to strategic investors.
The placement is expected to be sold at N2.65 per share.
