Sterling Bank Plc has received Central Bank of Nigeria (CBN)’s approval-in-principle to restructure from a stand-alone commercial bank to a holding company (holdco).
A regulatory filing indicated the bank has already commenced the process to obtain the final approval for the conversion to holding company.
Sterling Bank had divested from its non-bank subsidiaries in line with the banking regime, which requires banks with non-bank subsidiaries to either divest from such subsidiaries or adopt holdco structure.
Chief Executive Officer, Sterling Bank Plc, Mr. Abubakar Suleiman said the bank’s desire to operate as a holding company was driven by its plan to spin off its non-interest banking window which became operational in January 2014 into an autonomous entity.
He said the bank believes the proposed structure incorporates efficiencies around operations and financing efforts that will support the individual businesses in reaching full potential through increased portfolio diversification and improved efficiency among others.
He said the holdco structure enables the non-interest bank and other non-core businesses achieve greater results based on focused management of the distinct businesses while there would be improved efficiency resulting from the consolidation of key functions such as compliance, risk management and other support functions, yielding improved prospects for individual business growth.
According to him, the group would also benefit from enhanced corporate governance, which serves to promote a consistent culture across the group and quality of service to customers thereby facilitating sustainability of earnings.