Stories by Amaka Ifeakandu
Lagos
Shareholders of Sterling Bank Plc have approved dividend payment of N0.06 kobo for the financial year ended December 2014.
The shareholders who gave approval at the bank’s meeting commended the board for consistent payment of dividend to investors
. The President of the National Association for Advancement of Shareholders, Mr Farouk Uwar said that the bank received different awards during the year because of its performance and good service delivery.
He, however, said that the huge amount of money deposited by the bank with apex regulator without interest has continued to affect the profitability of the bank, adding that it has prevented the board from paying higher dividend.
For the bank to make profits and bring returns on investment to investors, he encouraged the board to move some of the bank’s business outside the country as part of measures to reduce regulators charges.
He also expressed the need for the bank to beef up its Capital base, adding that the bank required more fund to do bigger business. Addressing shareholders at the bank’s Annual General Meeting, (AGM) the Managing Director/ Chief Executive Officer, Yemi Adeola said the bank’s Non Performing Loans (NPL) moved from 2.1 per cent to 3.1 per cent due to the increase in the size of bank’s loan portfolio.
He, however, said that in the recent times many people that borrowed money from banks do not want to repay their loan, adding that this was one of the reasons the Bankers Committee decided to name and shame all the banks debtors.
Speaking further, he said “We are doing everything possible to ensure that debtors repay back the loan because the fund does not belongs to us but our customers.” He said that the banks capital position remains strong, adding the capital adequacy ratio of the bank which stood at 14 per cent was above 10 per cent regulatory requirement.
The Liquidity ratio according to him exceeded the regulatory benchmarks of 30 per cent by 400 basis points to 34 per cent.He said that although the bank has successfully completed $120 million Private Placement with net proceed of N18.5 billion, the board decided not to pay the entire fund as dividend to shareholders but conserve some of the capital to enable it use the money for business to bring higher returns to shareholders next year.
He said that the bank planned to further strengthen its capital position with a multi-currency debt capital of $200 million tier 2 in the coming year. “ We are going for tier 2 it is a debt instrument, a seven year subordinated bilateral money $200 million. We will use that to make more money for our customers and shareholders so that by this time next year, we will be able to pay much money than 6 kobo,” he added.
