FirstRand in talks with Nigerian bank
Lagos - South Africa's FirstRand [JSE:FSR] is in advanced discussions with Nigeria's Sterling Bank about making a strategic investment, the Nigerian lender said on Tuesday.
"Injecting more capital into our business, that's the only way we can expand," Sterling Bank's financial controller Adebimpe Olambiwonnu told CNBC Africa television.
"With FirstRand, yes, discussions are ongoing. We are quite positive. They are still at the due diligence stage and more information will be given subsequently," she said.
The comments confirm a Reuters story last month in which banking sources familiar with the negotiations said the two lenders were in advanced talks.
FirstRand Managing Director Sizwe Nxasana said last year the bank was looking to invest "meaningful amounts of capital" in Nigeria and would fund any deal from its reserves.
It was the first foreign bank to announce interest in buying one out of the nine Nigerian banks rescued by the central bank in a $4bn bailout in 2009 but later got cold feet.
Banking sources said FirstRand preferred to enter the Nigerian market through a strategic alliance with a healthy local bank and would be looking to deploy around $300m to $400m to fund such an investment.