CBN deducts N1.88 billion fine from Stanbic IBTC accounts

Stanbic IBTC Holdings, in a notice sent to the Nigerian Stock Exchange (NSE) stated that the Central Bank of Nigeria (CBN) has deducted N1.88 billion from the accounts of its banking subsidiary Stanbic IBTC Bank PLC.

This pertains to the fine imposed on the bank in relation to the remittance of foreign exchange on the basis of certain capital importation certificates issued to MTN Nigeria Communications Limited.

Stanbic IBTC Holdings PLC and Stanbic IBTC (the bank) however maintains its position on the matter, which is the fact that the Bank has done nothing illegal and accordingly the Bank will continue to provide CBN with documents and details in support of our contention that our actions in relation to these transactions were not illegal.

It also stated that the debit will not impact on the capacity of its banking subsidiary to handle clients’ requests or clients’ ability to continue to carry out viable business transactions with either the Bank or any member of the Stanbic IBTC Group, whether in relation to the importation of capital or otherwise.

How does it affect shareholders?

While Stanbic has stated that the fine has no material impact, it could lead to a much lower final dividend. Stanbic paid a final dividend of N0.50 per share for the 2017 financial year.

Luckily for shareholders, the fine comes after it paid its H1 2108 interim dividend. The bank typically tends to pay a large interim dividend and a small final dividend.

Stanbic IBTC closed at N42.40 in today’s trading session, down 9.79%.

Results for the half year ended June 2018, show gross earnings increased from  N97.1 billion in 2017 to N114 billion in 2018.

Profit Before Tax jumped from N29.1 billion in 2017 to N50 billion in 2018. Profit After Tax also increased from N24.1 billion in 2017 to N43 billion in 2018.

.