Sterling Bank eyes N35bn fresh capital in second half of 2016

Sterling Bank Plc has said N35 billion tier two capital raising would be concluded in the second half of 2016 as the bank continued strategising towards profitability.

In its half year result statement issued by the bank in Lagos, the Managing Director, Yemi Adeola, said the capital raising exercise would be completed before the end of 2016.

“As we look to the second half of the year, we remain committed to our plan to conclude our N35 billion tier two capital raise, prioritise operating efficiency and ensure moderate loan growth,” Adeola said.

He said the bank would continue to diversify funding sources as its retail banking strategy gains traction.

The statement said the bank’s non-performing for the half year ended June 30, 2016 dropped to 2.8 per cent against 4.8 per cent posted in the comparable period of 2015, attributing the drop to benefits of credit risk management and efficient cost management introduced by the bank.

The statement further explained that the 2.8 per cent ratio of non-performing loan was far below the industry threshold of five per cent.

The report also showed that the bank’s cost of funds also declined to 4.7 per cent against 5.9 per cent in the preceding period, while net interest income increased by 31.9 per cent to N25.6 billion during the review period compared with N19.4 billion in corresponding period of 2015.

“Non-interest income stood at N8.5 billion in contrast with N15.2 billion in first half 2015. Profits before and after tax stood at N4.4 billion and N4 billion respectively.”

It added that net loans and advances increased by 36.5 per cent to N462.3 billion, which was largely driven by foreign exchange revaluation.

Also, customer deposits increased to N627.9 billion from N590.9 billion achieved in the previous period.

The statement said the bank had remained irrepressible as demonstrated by the strength of its core business.

“The bank has taken steps to improve staff productivity by introducing a flexible work environment to achieve its goal of building a great workplace and reduce operating expenses,” it said.