Standard Bank, S/Africa Injects $190m into Stanbic
Category: Capital Market
With a few days left before the deadline given by the Central Bank of Nigeria (CBN) for banks operating in the country to raise their capital base to N25 billion, the Standard Bank Group of South Africa has injected $190 million (N24.5 billion) in its Nigerian subsidiary, Stanbic Bank.
With these fresh injection, Stanbic Bank which recently slowed down on its merger talk with Oceanic Bank will now join banks that have crossed the threshold set by the apex bank.
According to information, the South African bank decided to inject the funds following disagreements between Stanbic and Oceanic Bank over modalities for exchange of shares by the two institutions. Stanbic Bank Group believe that it would not be in its interest to negotiate any merger deal from a position of weakness.
\"The South African bank, post consolidation, would be able to negotiate better deal with any bank it may want to merge with should it still be necessary\", a source said.
Stanbic had been negotiating to take a minority stake in Oceanic, a deal which would have also seen the latter take over Stanbic Bank, to ensure a compliance with the new capital requirement. But when the discussions with Oceanic Bank was not going on as planned, Standard Bank of South Africa, the parent company had to inject the new funds to enable Stanbic raise its capital to N25 billion or risk liquidation before the December 31 deadline.
Standard\'s bid for a stake in Oceanic was its third failed attempt to expand into Nigeria, since July 2004 when CBN gave the directives that banks must recapitalise in a reform to consolidate the fragile and crowded industry.
Stanbic Bank\'s parent company, Standard Bank Group Limited is one of Africa\'s leading banking and financial services groups, and is based in South Africa. The company is listed on the Johannesburg Securities Exchange.
Rooted in Africa and with representation in strategic sub-Saharan markets, Standard Bank is a regional banking force with a global sweep. With total assets of about $81 billion and employing about 35,000 employees worldwide, Standard Bank has the largest presence in African nations.
The bank\'s network spans 17 sub-Saharan countries and extends to 21 countries on other continents, including the key financial centres of Europe, the United States and Asia. In addition to banking, Standard Bank has a strategic interest in the insurance industry through its control of the Liberty Group, one of Africa\'s leading life offices and financial services groups.
The group has one of the biggest single networks of banking services in Africa. With this network, it offers a wide range of banking products and services which are delivered through more than 1,000 points of representation in 17 African countries (including Nigeria). The bank is also active in international and cross-border transactions and in those areas liaise closely with Standard Bank Corporate and Investment Banking and Standard Bank London.
Stanbic opened in Nigeria in 1984 as Grindlays Merchant Bank of Nigeria and changed its name to Stanbic Bank Nigeria in 1992 following the take over of ANZ Grindlays\' African operations by Standard Bank.