Sterling Bank: South African Suitor Drops Bid

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South Africa’s FirstRand, the country’s second-largest banking group, said it had dropped acquisition talks with Nigeria’s Sterling Bank after failing to agree on terms for the deal.

FirstRand said in a statement on Friday it had terminated talks to acquire a majority stake in Sterling Bank, which has about 99 branches in Africa’s most populous nation.

“The parties have been unable to agree mutually acceptable terms,” the South African bank said.

South African lenders are keen to expand in fast-growing Nigeria, although the process so far has had plenty of hurdles. Nigeria in 2009 injected $4 billion into nine lenders deemed by auditors to have become so weakly capitalised that they posed a threat to the entire country’s banking system.

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Sterling Bank, which has a market value of around $177 million, was one of the lenders that passed the 2009 special audit.

FirstRand, which has said it was looking to invest “meaningful amounts of capital” in oil-rich Nigeria, said it still believed the country would be a key market for its Africa expansion strategy.

Shares of FirstRand were down 1.6 percent at 1056 GMT, while shares of Sterling Bank were little changed.