Diamond Bank Extends Purchasing Power To European Bank

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Diamond Bank Extends Purchase Power To European Bank

Mr. Alex Otti
Diamond Bank Plc has said that it is in finalising arrangements to acquire an European bank with a view to harnessing direct investment and trade flows from Europe into Nigeria.
According to the Reuters quoted Group Managing Director/Chief Executive Officer, Diamond Bank, Mr. Alex Otti, Tuesday, to have disclosed this during an investor conference call. But he did not disclose the name of the European bank.

Otti, was delighted that Diamond had received an approval in principle from the Central Bank of Nigeria (CBN) for the acquisition added that the bank did not need to raise additional capital to complete the deal. “We are not looking at buying a high-street bank. It’s going to be a specialised bank that will complement our services,” he said.

“We have a lot of business flow in that direction (Europe) and we use third parties to do those. We strongly believe that if we are successful it will add value to the bank,” Otti added.

According to the Bank boss, the bank expects to make an 18 per cent return on equity in 2012 and a pre-tax profit of up to N30 billion, compared with a loss of N16.26 billion last year.

Otti said Diamond had raised $170 million in debt this year, and was on track to boosting its total debt issued in 2012 to $500 million, including issuing a planned debut Eurobond at the end of the year, to boost capital adequacy to 17 per cent. “Around $70 million of the capital already raised had come from the World Bank’s private sector arm, the International Finance Corporation”, he said.

The mid-tier lender last week posted a pre-tax profit in the first nine months of the year to N23.2 billion ($148 million), pushing its shares up 20 per cent in two days, compared with a N6.9 billion loss in the same period last year. Its share price has gained 125 per cent so far this year.

“We have had to move (our operating profit) target to N55-N60 billion by year-end. We believe we should be ending the year anywhere between N25 to N30 billion pre-tax profit,” Otti said.

Diamond Bank is aggressively seeking to grow its operations to be able to tap into infrastructure and consumer growth in Nigeria. It plans to build extra 130 branches in within a period of two years, to add to its existing 220, he said.


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