The Central Bank of Nigeria (CBN) has approved the restructuring of Sterling Bank’s as a Holding Company.
A statement issued by Sterling Bank’s secretary, Temitayo Adegoke, said the CBN’s approval is sequel to its plan to spin off its non-interest banking window.
The non-interest banking window of the bank became operational in January 2014.
Adegoke said, “The proposed structure embodies efficiency around operations and financing efforts, that will support individual businesses in reaching full potential through increased portfolio diversification, enhanced corporate governance, and better access to capital, leveraging the financial strength of the group.”
“Going into the Holding Company structure, our desire is to entrench our business model premised on social capitalism, where we believe that private sector capital and market-based tools will offer the best types of solutions to Nigeria’s most pressing social and environmental challenges.
“The Holding Company gives us the structure to explore our business model further.”
The bank explained that the Holding Company is designed to operate on three major premises – Specialization, Partnership, and Digitization.
It stated that the conventional bank will focus on building skills and using technology to provide solutions in the areas that are critical to development in the country – Health, Education, Agriculture, Renewable Energy, Transportation (HEART).
It added that the non-interest bank will focus on building partnerships that connect individuals and businesses, leveraging technology to create business optimization while solving for an individual’s daily financial needs.
“The proposed holding structure, therefore, presents an opportunity for the bank to diversify and increase its income stream, ensuring liquidity through the process,” it said.
Sterling Bank had reported mixed results in terms of key indicators for first half of of 2020.
While its net trading income increased from N717 million to N3 billion, its interest expenses declined to N12.5 billion. These positives were eroded by a sharp decline in its profit, from N5.7 billion recorded in mid-2019 to N5.4 billion in the corresponding period of 2020.
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