[size=13pt]Adenuga set to merge, re-brand ETB, Sterling
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Richard Aderounmu

   

Strong indications emerged over the weekend that the business mogul, Dr. Mike Adenuga Jr, owner of Equitorial Trust Bank Limited (ETB) who recently acquired majority ,

shares in Sterling Bank Plc may have opted to merge the two banks – ETB and Sterling - and re-brand the new mega bank that would emerge from the two.
A close associate of the billionaire businessman told BH that conclusion has been reached on the merger option and re-branding of the new entity. However, the source declined to disclose whether the new entity that will emerge from the two banks would wear a new name or operate with the old name. A top level staff at ETB headquarters in Lagos, confided that ETB would be retained, especially as the cost implications of going for a new name is being considered.

“Very soon the two banks would be  merged and what we will have will be one big bank that will be able to compete favourably with others and we are looking at being one of the top six banks in the country in 2014. Also, the management is hoping to increase the branch network to 200 before the end of the Q1 of 2012.”
When BH visited some of the branches of Sterling and ETB last week, some of the staff were ecstatic that the new entity would offer them a greater opportunity of advancing their careers.
A Sterling staff who pleaded not to have his name in print, told BH that the deal will help boost the profile and deposit base of the bank. Although some of the staff were apprehensive that there might be staff rightsizing.

In its 2010 performance, Sterling Bank posted a Profit After Tax (PAT) of N4,178,493bn an increase of 168.73 per cent from a loss of N6,660.406bn in the previous year. In 2008 the Bank made a PAT of N6,523,153bn,  an increase of 950 per cent from 2007 PAT of N620.658m.
Analysts are predicting that the new entity that would emerge from the two banks would surpass revenue projections for the next business year.
The source also disclosed that many staff of ETB especially, in the top cadre from the position of Assistant General Manager and above have all been relieved of their duties to facilitate a hitch free merger between the two financial institutions. It was also confirmed to BH that the current Managing Director of the bank, said he will only help to see the merging arrangement through before his exit.



The combination would bring the new entity's business network to 191. Both banks which signed a Transaction Implementation Agreement a few weeks ago have doubled efforts to ensure the success of the merger. Before now, ETB was one of the eight rescued banks and was managed by the appointee of the Central Bank of Nigeria (CBN).  Sterling Bank Plc is a medium sized bank with shareholders’ funds of about N30billion with 98 branches while ETB maintains 93 branches.

Of all the banks operating in Nigeria, ETB is the only local financial institution that is not quoted on the Nigerian Stock Exchange (NSE). The bank was able to raise the minimum capital base of N25billion in 2005.  Not much was heard about the bank until in September 2009, when the CBN sacked its Executive Management and replaced them with her appointees. However, its new management quickly sacked 150 staff after it failed the stress test of the CBN to cut operational costs. The new management also slashed staff salary by half in order to continue as a going concern. As at last December 31, 2010, the CBN's report showed that the bank had the smallest Negative asset value at N27.253billion.

Adenuga, in 2009 injected $150 million into the bank after the Central Bank of Nigeria removed its executive management. And the CBN had, according to reports, acknowledged notification of the action from the owner of the bank and returned the bank to Adenuga, although it continued to retain its appointed interim management team in the bank.

Source

where does adenuga gets all these money that he splashes frm?

This na old gist. It was in Businessday since 2 weeks ago.