Sterling Bank Plc has ended talks to buy rival Keystone Bank Limited after finding it an unsuitable fit and is now focused on raising funds as it considers other acquisitions, its chief finance officer, Abubakar Suleiman, said on Tuesday.

“We reviewed Keystone Bank and concluded the strategic fit was not strong enough. We will continue to evaluate all the options. As new candidates come into the market, we will also review them,” Suleiman, told Reuters by phone.

Sterling Bank said in February it was aiming to buy one or two mid-sized lenders as sharp falls in the value of the naira and increased regulatory pressure forced banks to recapitalise. Keystone Bank is the last of Nigeria’s nationalised lenders, which state-backed “bad bank” AMCON is seeking to sell.

Suleiman said Sterling’s strategic plan was still to acquire a rival in Nigeria but that any move was likely to come after studying the impact of last month’s 30 per cent fall in the value of the naira.
The central bank ditched its 16-month old peg of N197 to the dollar in June to allow the currency to trade freely, in an effort to resolve a chronic dollar shortage that has stifled economic growth.

However, dollar shortages remain as Nigeria suffers from a plunge in oil prices which has battered its currency and stoked inflation to an almost 11-year high. Analysts see the slowdown as catalyst for mergers.

Sterling has completed book building for a N35 billion bond sale, its first tranche of a debt programme, Suleiman said, but added that the bank will raise only 20 per cent of that amount to gauge appetite once it receives regulatory approval.
Bond yields in Nigeria are currently below inflation at 16.5 per cent in June. The most liquid 5-year government bond traded at a yield of 15.17 per cent on Tuesday.

“Once we see that the structure is acceptable and yields are moderate, we will complete series one this year. If the market remains turbulent, we will do it next year,” Suleiman said.

dadebayo1:
What is happening to keystone bank? Noticed they have shut down the office at awolowo Road ibadan.. More job loss to those working at that particular branch.. Too bad

san316:
Bad market for keystone, the unworthy bride.

Adesiji77:


Looping LeemahT

It may not necessarily mean that they are going down the drain or be an "unworthy bride" as you put it.

In Sterling Bank words: “We reviewed Keystone Bank and concluded the strategic fit was not strong enough...."

In my humble opinion, that could be anything from branch network to customer segmentation...

Let us watch as events unfold.

san316:

Keystone bank as it is, with its loan portfolio and NPLs it can hardly serve any bank's strategic interest. The branch network cannot be the cause because it arguably has more branches than main street bank. It was put in the market along with enterprise and main street bank but its the only one standing.

The bank's former board of directors really dealth with the bank. Corruption in high places. They should just convert the bank to a hotel joor. Kidding though

Adesiji77:


You better be kidding

dguizman:
Keystone is a dead bank already...thanks for the service they rendered for me right frm the bank phb days.

GoldCircle:
Why won't they take to their heels after seeing what happened to Skye Bank after they swallowed something (Former Afribank/Mainstreet bank) bigger than their stomach could accommodate?!
A word is enough for the wise!

Na leaf wey dey sweet goat, dey kill am!

360ng:
SORRY, WHAT IS KEYSTONE?

Damfostopper:
I have hundred of thousands in my keystone account.... I no wan here tori o

360ng:
SORRY, WHAT IS KEYSTONE?

Bolustic:
I'd have preferred GTBANK to Sterling. The former is an epitome of efficiency and innovation .

Chukazu:


it's Sanusi that killed that banks.
bank PHB use to be the most creative and innovative bank but Sanusi came, saw and destroyed.

Adesiji77:


"Awolowo Road"? You mean at Bodija?