Sterling Bank Plc’s shares were the toast of the stock market yesterday, as investors rallied the lender’s clarification over the recent issue involving the institution and the Economic and Financial Crimes Commission (EFCC). In a statement to the Nigerian Stock Exchange (NSE), Sterling Bank affirmed that it did not hold account for “the public officer from the previous administration to which this matter.
(EFCC visit to the bank) has been linked either officially or otherwise”. Some reports – most especially online, had linked last week’s investigative visit by the EFCC to the bank to the slush political dealings involving former Minister of Petroleum Resources, Mrs Diezani Allison-Madueke, generally known as Diezanigate. EFCC had also been investigating diversion of arms funds, otherwise known as Dasukigate, named after the former National Security Adviser, Col. Sambo Dasuki (rtd).
Sterling Bank explained that while the reason for the visit by the EFCC last Wednesday was not immediately clear, it has now been confirmed that the investigation is related to the banking relationship of a non-bank financial institution that is a client of Sterling Bank Plc. “We affirm for the public records that the bank does not hold the account of the public officer from the previous administration to which this matter has been linked either officially or otherwise; the non-bank financial institution (Asset Management Company) in question purchased a number of loans on a recourse basis from Sterling Bank Plc on commercially acceptable terms and this is the link of the concern raised by the EFCC to Sterling Bank Plc,” Sterling Bank stated.
The lender’s share price rose by 4.91 per cent yesterday, the eighth highest percentage gain within the five-hour trading session. Sterling Bank’s share price closed at N1.71. The gain by Sterling Bank helped the banking sector to a positive close in a market overwhelmed by losses by several highly capitalised stocks. Analysts at Afrinvest Securities stated that the gains by Sterling Bank and two other banks- Diamond Bank and Zenith Bank, were largely responsible for the extended bullish run of the NSE Banking Index, which rose by 0.6 per cent.
The overall market position closed negative yesterday with average decline of 0.70 per cent, equivalent to a loss of N62 billion. The All Share Index (ASI)-the value-based index that tracks all quoted equities on the NSE declined from 25,828.30 points to close at 25,646.56 points. Aggregate market capitalisation of all quoted equities also dropped from N8.884 trillion to close at N8.822 trillion. Meanwhile, Sterling Bank according to the statement to the local bourse, gave assurance to the investing public that it had commissioned a review of the compliance procedures of its non–bank financial institution clients with the aim of strengthening this area of its operations while in the interim, the bank will not accept any new non-bank financial institution relationships.
“We thank our numerous partners for their support and assure you that the bank remains a compliant institution that continues to conduct its business within the ambit of the law,” Sterling Bank stated.