Sterling Bank Plc has secured regulatory approval from
the Nigerian Stock Exchange, NSE, to raise about N8 billion in new capital as a
first step in a large new capital issuance through which the lender seeks to
raise a total of N65 billion.
The financial
house would be raising the new capital through an indirect special purpose
vehicle known as Sterling Investment Management SPV Plc,
a regulatory document obtained by the Nation on Tuesday,
October 11 showed.
According to the
document, Sterling Investment Management SPV will be offering for subscription
N7.965 billion in its series 1: seven-year 16.50 per cent fixed rate unsecured
bonds due 2023. The maiden issuance is part of the bank’s N65 billion debt
issuance programme.
Sources in the know
confirmed that the SPV is a tier-11 capital raising programme for Sterling
Bank, describing it as a creative way to shield the bank from unnecessary
regulatory and market issues while having access to the much-needed capital.
The document indicated
that the Nigerian Stock Exchange (NSE) has already approved the debt issuance,
paving the way for the bank to conclude the pre-offer opening processes.
Global Credit Ratings
(GCR) has accorded a final, public national scale long term rating of BBB (NG)
to the N7.97 billion bond; with the outlook accorded as stable. The rating is
valid until 31 August 2017.
Managing Director,
Sterling Bank Plc, Yemi Adeola, recently said the bank was concluding
arrangements to raise tier 2 capital in the second half of this year as
improved assets quality and lower cost of fund steadied the performance of the
bank in the first half of this year.
He said the bank would
in the second half of the year continue to prioritise operating efficiency and
ensure moderate loan growth; while continuing to diversify funding sources as
our retail banking strategy gains traction.
He added that the bank also remained committed
to its plan to conclude its N35 billion tier 2 capital raising.
Source:
bizwatchnigeria
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