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Sterling Bank gets CBN approval for restructuring

Sterling Bank has obtained the CBN’s approval in principle to enable it restructure as a Holding Company.

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Sterling Bank, Sterling Bank: Impressive growth in profit despite elevated OPEX, Sterling Bank gets CBN approval for restructuring

Sterling Bank has announced its approval from the Central Bank of Nigeria, to enable it to restructure as a holding company, sequel to its plan to spin off its Non-Interest Banking window. Recall that the Non-Interest Banking window of the bank became operational in January 2014.

In a press release signed by the Bank’s secretary, Temitayo Adegoke and sent to the Nigerian Stock Exchange, the bank believes that 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.

Commenting on the proposed holding structure of the bank, a part of the press release read thus, “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. Partnership Technology Specialization. The Holding Company is designed to operate on 3 major premises – Specialization, Partnership, and Digitization. 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). 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.’’

Recall that Sterling Bank had earlier reported mixed results in terms of key indicators for H1, 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.

In light of the aforementioned key indicators; the proposed holding structure, therefore, presents an opportunity for the bank to diversify and increase its income stream, ensuring liquidity through the process.

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Business

#EndSARS: We were not hacked – CBN

The Central Bank of Nigeria has dismissed rumours that its website was hacked by hacker group, Anonymous.

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CRR Debits, #EndSARS: We were not hacked - CBN

The Central Bank of Nigeria (CBN) has debunked rumours that its website was hacked. This was disclosed via its official Twitter handle in the early hours of today.

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The apex bank assured the Nigerian public that there was no cause for alarm and it would do everything within its statutory power to protect its proprietary data from being breached.

READ: #EndSARS: National Human Rights Commission sets up independent investigative panel

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READ: $70 billion per annum will be needed to tackle pandemic induced poverty – World Bank

The press release concluded by advising the Nigerian public to ignore such false claims, designed at undermining the credibility of the CBN.

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Backstory

Nigerians were shocked yesterday when the website of the CBN was temporarily off the grid, leaving many to suspect that it may have been hacked. Recall that Anonymous, an international hackers group, had earlier claimed via its Twitter handle, that it breached some Nigerian government websites.

READ: CBN invests over N120 billion on 320,000 farmers across CTG within four years

The act is said to be in support of the ongoing #EndSARS protests that have taken over many cities in Nigeria, following calls for the disbandment of the notorious police unit – FSARS.

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Financial Services

Stanbic IBTC retains Fitch’s AAA Rating

Stanbic IBTC Holdings PLC and Stanbic IBTC Bank PLC were rated high based on the potential support from their parent company, Standard Bank Group.

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Stanbic IBTC

Globally renowned credit rating agency, Fitch Ratings, has reaffirmed that Stanbic IBTC Holdings PLC and its subsidiary, Stanbic IBTC Bank PLC, have retained their National Long-Term’ AAA (nga)’ and National Short-Term’ F1+(nga)’ ratings.

Fitch Ratings is a leading provider of credit ratings, commentary and research for global markets. The National Long-Term’ AAA (nga)’ and National Short-Term’ F1+(nga)’ Ratings are the highest possible ratings on Fitch’s rating scale.

Stanbic IBTC Holdings PLC and Stanbic IBTC Bank PLC were rated high based on the potential support from their parent company, Standard Bank Group, which is based in South Africa.

According to Fitch Ratings, both organisations retained their ratings as a result of the vital role they play in Standard Bank Group’s primary operations in West Africa as well as its size and high operational integration.

“The National Long-Term Ratings on Stanbic IBTC Bank’s N30 billion senior unsecured notes and the National Long- and Short-Term Ratings on the N150 billion structured note programme for senior unsecured debt are in line with the Bank’s issuer ratings,” Fitch says.

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Stanbic IBTC Holdings PLC is a subsidiary of the Standard Bank Group. Its principal operating entity is Stanbic IBTC Bank, a mid-tier commercial bank, which represented 96 per cent of the holding company’s consolidated assets at the end of 2019.

Both entities are highly integrated with Standard Bank Group’s risk-management framework with access to Standard Bank Group’s competitive advantages relative to peers. This also includes connectivity to its network and the ability to serve large domestic and multinational companies.

The ‘AAA (nga)’ is given to issuers with the lowest expectation of default risk when compared with their competitors. The National Short-Term Rating of ‘F1+(nga)’ is assigned to issuers that have the strongest capacity for timely payment of financial commitments in comparison to other issuers in Nigeria

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Cryptocurrency

Crypto: Popular Hedge Fund, Grayscale record best quarter ever

Grayscale Investments has had impressive growth after registering its third consecutive record-breaking quarter.

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Crypto: Popular Hedge Fund, Grayscale record best quarter ever

Popular American based hedge fund, Grayscale Investments, has had impressive growth after registering its third consecutive record-breaking quarter with more than a billion inflows recorded.

READ: How to buy and sell Bitcoins in Nigeria

READ: CBN knocks airline and shipping firms over non-compliance with form NXP

Bitcoin Trust, Grayscale Investments product remained the most widely selected investment product. Grayscale Investments in its most recent report for Q3 2020 report, total investments into the digital asset managers fund in those three months alone accounted for more than a billion dollars. Adding Q1, Q2, which were also record-breaking at their respective time, the year-to-date inflows surged to $2.4 billion.

READ: Ripple owners say XRP will be worth $100

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READ: CBN clears air on Diaspora Remittances, official inflows $2.6bn not $26bn 

READ: Has the President erred in stopping CBN from funding food imports?

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Just for comparing our massive, the recent feat is, Grayscale had received $1.2 billion s2013 to 2019. This makes the year to date for 2020 inflows twice as much.

READ: Gold Prices cross $1800, first time since 2011

What you must know; Grayscale Bitcoin Trust Among Fastest Growing Investment Products: Grayscale Bitcoin Trust experienced $719.3 million in 3Q20 inflows.

  • The Trust has seen its assets under management (“AUM”) surge from $1.9 billion to $4.7 billion YTD.
  • Grayscale Bitcoin Trust does not operate a redemption program and its shares do not trade on a national securities exchange.
  • Trust is therefore not an ETP or ETF. Still, if the Trust were compared to global ETPs and ETFs with over $1B AUM at the start of the year, it would rank as the third-fastest growing product YTD with an AUM increase of approximately 147%.

READ: Nigeria’s diaspora remittance to hit $34 billion by 2023 – PwC

READ: The week that shook the world: the collapse of the Lehman Brothers and the effect it had on me

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Backstory

Recall Nairametrics about five months ago, revealed how institutional investors and hedge funds around the world have been rushing to have a stake in crypto assets which all have been outperforming other financial assets in 2020.

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A popular hedge fund based in New York –Grayscale Investments –caught the investment world by surprise by buying up Bitcoin (BTC) at a great rate in recent months.

READ: Update: Buhari seeks power to freeze accounts, clamp down on money launderers

What you need to know about Hedge Funds; They are firms that offer alternative investments to a specific type of investors (high net worth individuals), in a bid to protect their investment portfolios from market uncertainty, while generating positive returns regardless of market sentiments.

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READ: CBN gives approval for Stirling Trust to start offering cash-in-transit services

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