News Column

Kunoch Holdings Buys 14.8 Percent Actis, CDC Stake in Diamond Bank

August 21, 2014

Kingsley Ighomwenghian

The management of Diamond Bank Plc, on Wednesday announced the acquisition of its 14.79 per cent of its issued share capital by Kunoch Holdings, from Actis LLP and CDC Group Plc.

Funds managed by Actis, a private equity investor specialising in investments in emerging markets, acquired a significant equity stake in the Bank in 2007, which are now coming to the end of its closed-end period.

A statement by Peter Schmid, Actis Head of Private Equity, said: "We have worked with Diamond Bank to build a strong franchise over the last seven years. During the period of our investment, Diamond Bank underwent substantial change and is now recognised by the Central Bank of Nigeria as one of the systemically important banks in the industry. The Bank has a strong and capable management team to take it to the next stage of its development and Actis wishes Alex and his team well in this next phase."

Also commenting, Dr. Alex Otti, Group Managing Director of Diamond Bank expressed pleasure at having "worked with Actis over the last seven years, and are excited about the next stage of the Bank's development. Diamond Bank is one of the leading retail banks in Nigeria, with exciting growth prospects in the retail segment of the Nigerian economy as well as a strong position in the Micro, Small and Medium Scale Enterprises and corporate segments of the economy. Diamond Bank has been described as one of the fastest growing Banks over the past three years in the Tier II category and potentially the next Bank that would move to the Tier I category. The Bank is currently undertaking a Rights Issue to raise an additional N50.3 billion which is expected to position the Bank to further enable it to execute its strategy going forward".

Meanwhile, Guaranty Trust Bank Plc, on Thursday, presented its audited result for the half year ended June 30, 2014, to the Nigerian Stock Exchange (NSE), highlight of which was the declining growth in earnings and profit amidst a soaring loan loss expenditure profile within the period.

According to the result, gross earnings income limped by 7 per cent from N124.202 billion to N132.985 billion, on the back of the interest income growth of 8 per cent to N99.715 billion and 20 per cent rise in interest expenses at N28.153 billion; leaving a net interest income of N71.562 billion. Operational expenses rose by 9 per cent to N45.362 billion; just as loan loss expenses jumped by 287 per cent to N5.104 billion, as against the previous N1.317 billion.

Profit before tax therefore stood at N53.396 billion, down by 7 per cent from N57.364 billion; while after tax profit fell 10 per cent to N44 billion, from N49.018 billion. The board is offering a dividend of N7.357 billion, same as in the corresponding period of last year, translating to a dividend of 25 kobo, from earnings per share of N1.55.

On the balance sheet, loans and advances portfolio managed to rise by 3 per cent to N1.038 trillion, from N1.007 trillion; on the back of a N1.568 trillion deposit base, as against the previous N1.442 trillion. Net assets for the period dropped marginally to N328.648 billion from N332.353 billion.

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Source: AllAfrica

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