Lagos, Nigeria, 27 September 2022: With the unanimous support received from its shareholders, Sterling Bank, soon to be known as Sterling Financial Holdings Company, is firmly positioned to expand its financial services footprint from traditional banking and deliver more value to its shareholders.
According to the publicly available filings reviewed from the website of the Nigerian Exchange Limited (NGX), upon final ratification by the regulators, the commercial banking subsidiary of the holding company, Sterling Bank; will continue to operate with its current name as a limited liability company, with shares transferred from the publicly traded company transferred to the newly formed Sterling Financial Holdings Company.
At a recently held court-ordered meeting where the resolution was approved by the bank’s shareholders, the chairman of the bank’s board, Asue Ighodalo, said, “Following the implementation of the scheme, shareholders will exchange their shares in the Bank for shares in HoldCo in the same proportion as their current holdings in the Bank, which will be a regulated entity for CBN purposes.”
The Chairman added that the scheme would provide several benefits to the shareholders of the Bank, some of which include facilitating diversification into other permissible business lines, thereby promoting growth and enhancing shareholder value and facilitating a consolidated financial strength of the group, which will improve access and ability to raise capital.
According to Chief Executive of Sterling Bank, Abubakar Suleiman, the advantages of the newly formed holding company include value creation to maximize earnings through new businesses, agility to optimize for opportunities and adapt to a rapidly changing market, maximize current and future talent potential with opportunities within the group and subsidiaries to nurture and engage its wealth of young and innovative talent.
The holding company also affords Sterling another opportunity to leverage its successful HEART strategy, which has seen the bank make consolidated investments in the Health, Education, Agriculture, Renewable Energy, and Transportation sectors, growing the company’s year-on-year profits to record highs despite strong economic headwinds.
With the adoption of a Holdco structure, Sterling now possesses the latitude to make inroads into other sectors within financial services, such as pensions, asset management, payment services, real estate, and different verticals, along with the current banking licenses held by the commercial and non-interest banking subsidiaries, Sterling Bank and The Alternative Bank.
In recent times, the bank has doubled down on digitization with specialized products through the development and introduction of Specta, OneBank, I-invest, Gazelle, and Omni X to fulfill the market’s needs for innovative retail and commercial banking solutions.
A holding company, or Holdco, is a company set up for the purpose of making and managing, for its own account, equity investment in two or more companies, being its subsidiaries, engaged in the provision of financial services, one of which must be a bank.