Sterling Bank (action plan announcement)

[prince dagbolu]

First i like to congratulate all of us that have taken this fight thus far. If we had not fought, Sterling Bank would never have come out with their statement.

I agree that we now have to change our strategy, because they have now come out with a statement. Whatever we do should involive something that invites other like minded people to join us in this battle.

Once again i am concerned that RCM online and Zainabbusman had to make additional contribution, for us to realise the N140,000 we needed for our advert in the punch. Afterall, Zainabusman does not even have any shares with Sterling Bank.

Those that had lost money in this re-construction, who failed to contribute really need to ask themselves if they had done the right thing by failing to put their money where their mouth is?

[olusolakemmy]

we now have 142k
rcmonline might not have to send additional money for now.

we have the money required to do half a page in punch

give u more update later

[Babs_O]

Originally Posted by hispy99

Sterling Bank explains share reconstruction
By Gbenga Agbana

WORRIED by several complaints by investors about the recent share reconstruction embarked upon by Sterling Bank Plc, the bank's board of directors has clarified issues on the process.

Specifically, the board, in a statement issued at the weekend, said the reconstruction exercise was carried out after due diligence and approvals from regulatory authorities.

According to the statement, "the five banks that merged into Sterling Bank, entered into a scheme of merger, sanctioned by the court, which provided for two key review exercises to be undertaken in order to, whereby necessary, adjust the relative pre-merger values of the legacy banks. The two review exercises prescribed in the scheme were:

"A close-out audit of the accounts of each of the legacy banks as at 31st December 2005: to take into consideration and compensate pre-merger shareholders for changes that had occurred to the legacy banks' values since 31st March, 2005, when due diligence was conducted on the banks, i.e. the cut-off date for the merger.

"Post-merger adjustments: to further compensate pre-merger shareholders of the legacy banks, for material changes attributable to any of the legacy banks, provided that the aggregate value of such material change exceeded N100 million.

The bank explained further that each of the legacy banks appointed a firm of auditors/ consultants as its shareholders' representative. "The five shareholders' representatives, who derived their power from the court sanctioned scheme of merger, submitted a report dated 13th March, 2007 wherein they unanimously recommended the issuance of additional 13,317,026,285 ordinary shares as compensation shares to be issued to the various shareholders of the legacy banks who hitherto, were the holders of 10,552,847,651 ordinary shares of the bank."

Also, "the shareholders' representatives, mindful of the implication of almost 24 billion shares in issue also recommended a reconstruction of the entire shares.

"The shareholders of the bank, at the 45th yearly general meeting held on 28th August, 2007, approved a resolution for the reconstruction of the entire shares of the bank that is 23,869,873,936 ordinary shares of the bank."

In the statutory notice of the yearly general meeting, which was published in at least two national daily newspapers, it was specifically stated under special business, among others,'to consider, and, if thought fit, to pass the following resolutions as special resolutions: resolution10:'that the directors be empowered to reconstruct the bank's shares as a result of the post-merger share adjustment in accordance with the approved scheme of merger on the basis, terms, and at a time to be determined by the directors'. This resolution was unanimously approved by the shareholders.

The statement added that, "the two key regulatory agencies, the Nigerian Deposit Insurance Corporation (NDIC) and the Central Bank of Nigeria (CBN), in September 2007, separately wrote to the bank to invoke the clause relating to the close-out audit share adjustment in the scheme of merger to compensate the shareholders of the legacy banks as recommended by the shareholders' representatives.

"The Board of directors of the bank consequently applied for regulatory approvals to issue the compensation shares and simultaneously reconstruct the shares from the CBN, the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE); all the approvals were obtained.

"The bank subsequently placed the shares on total suspension from daily trading in order to effect the issuance of compensation shares as well as the reconstruction of the shares of the bank. This reconstruction was carried out at a ratio of 10 new shares for every 19 existing shares.

"It is true that the reconstruction of the original 10.5 billion shares (10 for 19) should have led to a simultaneous doubling of the share price; however, the issuance of the additional 13,317,026,285 compensation shares (also reconstructed) automatically diluted the expected effect.

"The situation was further exacerbated by the current bearish market."

The bank assured the shareholders that the merger/integration process has been completed and the financial institution "is on course to deliver superior return on investments and enhance shareholders' value."

Economic and Financial Crimes Commission (EFCC) needs to open a case for Sterling Bank. Some of the directors and associated persons in SEC, NSE or CBN need to be sent to jail to serve as a lesson for those ready to tow this fraudulent line. Definitely one or two insurance or whatever will be warming up to expose their can of worms and bail off with investor funds.

This is a major dent to investor confidence in the NSE, that one cannot rely on what SEC says is the current listed # of shares of a company.

[olusolakemmy]

Originally Posted by Babs_O

Economic and Financial Crimes Commission (EFCC) needs to open a case for Sterling Bank. Some of the directors and associated persons in SEC, NSE or CBN need to be sent to jail to serve as a lesson for those ready to tow this fraudulent line. Definitely one or two insurance or whatever will be warming up to expose their can of worms and bail off with investor funds.

This is a major dent to investor confidence in the NSE, that one cannot rely on what SEC says is the current listed # of shares of a company.

bros, i have been singing like parrot from day 1, but i must say thank you to smn member for agreeing to start something in the first place.

i have mentioned this efcc thing, but i will like to push the battle to that extent if this letter wont do much. I understand efcc only intervene and investigate only after the receive a petition, so we will be the one to petition them.

nigeria is a lawless land, ask me why?
have u ever asked ur self how bunmi oni(former cadbury nig md, and the best md in nigeria 2005) was exposed?, it was because the fraud directly affect a foreign company, cadbury uk.
if it is solely nigerian issue, that case would never come out, and he will still be going abt as one of the most respected md of our time!

that is why am really scared abt the high flying coys in nigeria.

[ntom]

Originally Posted by Babs_O

Economic and Financial Crimes Commission (EFCC) needs to open a case for Sterling Bank. Some of the directors and associated persons in SEC, NSE or CBN need to be sent to jail to serve as a lesson for those ready to tow this fraudulent line. Definitely one or two insurance or whatever will be warming up to expose their can of worms and bail off with investor funds.

This is a major dent to investor confidence in the NSE, that one cannot rely on what SEC says is the current listed # of shares of a company.

is ndi still there expect worse things

[bolowo]

Hi folks,

Why would the NSE, SEC etc allow Sterling Bank to get away with murder? It means in no time they can tell depositors that they have done a reconstruction of their funds where every million naira would settle for ten thousand naira.

They cannot tell me that they dont have records of old and new shareholders, they should have compensated the old ones with whatever number of units and left the new ones with their existing holding.

I hear the MD of sterling is a God fearing person, and if he truly is, he must not be a party to this. The reconstruction of new investors should be reversed or how do we explain purchasing their shares for N17 -if 50,000 units bought at N9 is now 26,000 purchased at the same N450,000.

Infact, why was this not made public such that people would have been better informed and applied caution in investing.

I pray that God intervenes in this matter. You should not rob me of my funds and my shares at the same time.

[olusolakemmy]

Worried by several complaints by investors about the recent share reconstruction embarked upon by Sterling Bank Plc, the bank's board of directors has clarified issues on the process.

So there must be several complaints before the board of directors will come out and explain

Specifically, the board, in a statement issued at the weekend, said the reconstruction exercise was carried out after due diligence and approvals from regulatory authorities.

how can they say that due diligence was carried out to commit this fraud?
what was wrong with due diligence during the merger process?


According to the statement, "the five banks that merged into Sterling Bank, entered into a scheme of merger, sanctioned by the court, which provided for two key review exercises to be undertaken in order to, whereby necessary, adjust the relative pre-merger values of the legacy banks. The two review exercises prescribed in the scheme were:

please can some explain what they mean by adjust the relative pre-merger value?
is it that the value the bank presented during merger were not absolute that they require an adjustment if the director like?



"A close-out audit of the accounts of each of the legacy banks as at 31st December 2005: to take into consideration and compensate pre-merger shareholders for changes that had occurred to the legacy banks' values since 31st March, 2005, when due diligence was conducted on the banks, i.e. the cut-off date for the merger.



"Post-merger adjustments: to further compensate pre-merger shareholders of the legacy banks, for material changes attributable to any of the legacy banks, provided that the aggregate value of such material change exceeded N100 million.

this is really madness, what and why are they compesating?
shareholders worth before and after merger are suppose to be the same, isnt it?
so if am worth 100k with magnum before merger, after merger, idealy i shld still be worth 100k in sterling, irrespective of the unit of shares i now have, so i dnt need to be compesated


The bank explained further that each of the legacy banks appointed a firm of auditors/ consultants as its shareholders' representative. "The five shareholders' representatives, who derived their power from the court sanctioned scheme of merger, submitted a report dated 13th March, 2007 wherein they unanimously recommended the issuance of additional 13,317,026,285 ordinary shares as compensation shares to be issued to the various shareholders of the legacy banks who hitherto, were the holders of 10,552,847,651 ordinary shares of the bank."

who are this shareholders sactioned by the court that represented the five banks?
this guys must be directors in each of the banks that formed sterling!
why are they presenting them like a regular shareholders like us, they can make decision to suit themselves

Also, "the shareholders' representatives, mindful of the implication of almost 24 billion shares in issue also recommended a reconstruction of the entire shares.
there is nothing wrong with reconstruction, but i repeat pre and post reconstruction shareworth of every shareholder should remain, it can then fall or rise according to market dictate


"The shareholders of the bank, at the 45th yearly general meeting held on 28th August, 2007, approved a resolution for the reconstruction of the entire shares of the bank that is 23,869,873,936 ordinary shares of the bank."



In the statutory notice of the yearly general meeting, which was published in at least two national daily newspapers, it was specifically stated under special business, among others,'to consider, and, if thought fit, to pass the following resolutions as special resolutions: resolution10:'that the directors be empowered to reconstruct the bank's shares as a result of the post-merger share adjustment in accordance with the approved scheme of merger on the basis, terms, and at a time to be determined by the directors'. This resolution was unanimously approved by the shareholders.

what a joke, so did sterling bank explain at the meeting to shareholders that, the consequence of the reconstruction is that some people share will be divided into two while shares will be added to others?

the vote receive a unanimous support, who in his right mind will support a vote to have his money stolen? even if that person is a money miss road

The statement added that, "the two key regulatory agencies, the Nigerian Deposit Insurance Corporation (NDIC) and the Central Bank of Nigeria (CBN), in September 2007, separately wrote to the bank to invoke the clause relating to the close-out audit share adjustment in the scheme of merger to compensate the shareholders of the legacy banks as recommended by the shareholders' representatives.

how can?
how can cbn write you to commit this?
how can cbn approve this?
if cbn can be approving stuff like this, who do we run to?

"The Board of directors of the bank consequently applied for regulatory approvals to issue the compensation shares and simultaneously reconstruct the shares from the CBN, the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE); all the approvals were obtained.



am not surprise thy got approval from nse and co
na dem way, thats there way, poor governance

"The bank subsequently placed the shares on total suspension from daily trading in order to effect the issuance of compensation shares as well as the reconstruction of the shares of the bank. This reconstruction was carried out at a ratio of 10 new shares for every 19 existing shares.



"It is true that the reconstruction of the original 10.5 billion shares (10 for 19) should have led to a simultaneous doubling of the share price; however, the issuance of the additional 13,317,026,285 compensation shares (also reconstructed) automatically diluted the expected effect.

it is not our business if you issue additional 13b shares, you have to ensure that, you pro-rate it such that no one is short change

"The situation was further exacerbated by the current bearish market."
even if the market is bullish and they do this, they will still receive smae reaction

The bank assured the shareholders that the merger/integration process has been completed and the financial institution "is on course to deliver superior return on investments and enhance shareholders' value." - Guardian

please we dont need their assurance, they shld simply revert this nonsense

[prince dagbolu]

Originally Posted by olusolakemmy

Worried by several complaints by investors about the recent share reconstruction embarked upon by Sterling Bank Plc, the bank's board of directors has clarified issues on the process.

So there must be several complaints before the board of directors will come out and explain

Specifically, the board, in a statement issued at the weekend, said the reconstruction exercise was carried out after due diligence and approvals from regulatory authorities.

how can they say that due diligence was carried out to commit this fraud?
what was wrong with due diligence during the merger process?


According to the statement, "the five banks that merged into Sterling Bank, entered into a scheme of merger, sanctioned by the court, which provided for two key review exercises to be undertaken in order to, whereby necessary, adjust the relative pre-merger values of the legacy banks. The two review exercises prescribed in the scheme were:

please can some explain what they mean by adjust the relative pre-merger value?
is it that the value the bank presented during merger were not absolute that they require an adjustment if the director like?



"A close-out audit of the accounts of each of the legacy banks as at 31st December 2005: to take into consideration and compensate pre-merger shareholders for changes that had occurred to the legacy banks' values since 31st March, 2005, when due diligence was conducted on the banks, i.e. the cut-off date for the merger.



"Post-merger adjustments: to further compensate pre-merger shareholders of the legacy banks, for material changes attributable to any of the legacy banks, provided that the aggregate value of such material change exceeded N100 million.

this is really madness, what and why are they compesating?
shareholders worth before and after merger are suppose to be the same, isnt it?
so if am worth 100k with magnum before merger, after merger, idealy i shld still be worth 100k in sterling, irrespective of the unit of shares i now have, so i dnt need to be compesated


The bank explained further that each of the legacy banks appointed a firm of auditors/ consultants as its shareholders' representative. "The five shareholders' representatives, who derived their power from the court sanctioned scheme of merger, submitted a report dated 13th March, 2007 wherein they unanimously recommended the issuance of additional 13,317,026,285 ordinary shares as compensation shares to be issued to the various shareholders of the legacy banks who hitherto, were the holders of 10,552,847,651 ordinary shares of the bank."

who are this shareholders sactioned by the court that represented the five banks?
this guys must be directors in each of the banks that formed sterling!
why are they presenting them like a regular shareholders like us, they can make decision to suit themselves

Also, "the shareholders' representatives, mindful of the implication of almost 24 billion shares in issue also recommended a reconstruction of the entire shares.
there is nothing wrong with reconstruction, but i repeat pre and post reconstruction shareworth of every shareholder should remain, it can then fall or rise according to market dictate


"The shareholders of the bank, at the 45th yearly general meeting held on 28th August, 2007, approved a resolution for the reconstruction of the entire shares of the bank that is 23,869,873,936 ordinary shares of the bank."



In the statutory notice of the yearly general meeting, which was published in at least two national daily newspapers, it was specifically stated under special business, among others,'to consider, and, if thought fit, to pass the following resolutions as special resolutions: resolution10:'that the directors be empowered to reconstruct the bank's shares as a result of the post-merger share adjustment in accordance with the approved scheme of merger on the basis, terms, and at a time to be determined by the directors'. This resolution was unanimously approved by the shareholders.

what a joke, so did sterling bank explain at the meeting to shareholders that, the consequence of the reconstruction is that some people share will be divided into two while shares will be added to others?

the vote receive a unanimous support, who in his right mind will support a vote to have his money stolen? even if that person is a money miss road

The statement added that, "the two key regulatory agencies, the Nigerian Deposit Insurance Corporation (NDIC) and the Central Bank of Nigeria (CBN), in September 2007, separately wrote to the bank to invoke the clause relating to the close-out audit share adjustment in the scheme of merger to compensate the shareholders of the legacy banks as recommended by the shareholders' representatives.

how can?
how can cbn write you to commit this?
how can cbn approve this?
if cbn can be approving stuff like this, who do we run to?

"The Board of directors of the bank consequently applied for regulatory approvals to issue the compensation shares and simultaneously reconstruct the shares from the CBN, the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE); all the approvals were obtained.



am not surprise thy got approval from nse and co
na dem way, thats there way, poor governance

"The bank subsequently placed the shares on total suspension from daily trading in order to effect the issuance of compensation shares as well as the reconstruction of the shares of the bank. This reconstruction was carried out at a ratio of 10 new shares for every 19 existing shares.



"It is true that the reconstruction of the original 10.5 billion shares (10 for 19) should have led to a simultaneous doubling of the share price; however, the issuance of the additional 13,317,026,285 compensation shares (also reconstructed) automatically diluted the expected effect.

it is not our business if you issue additional 13b shares, you have to ensure that, you pro-rate it such that no one is short change

"The situation was further exacerbated by the current bearish market."
even if the market is bullish and they do this, they will still receive smae reaction

The bank assured the shareholders that the merger/integration process has been completed and the financial institution "is on course to deliver superior return on investments and enhance shareholders' value." - Guardian

please we dont need their assurance, they shld simply revert this nonsense

Well done jare. Your commentary was spot on.

[rcmonline]

This is an email i received from a law firm regarding the reconstruction:

Dear Mr. Okoye:

Good morning. We read your letter to the Director-General of the Nigerian Stock Exchange, Prof. (Mrs.) Ndi Okereke-Onyuike dated September 19, 2008 on the above subject-matter. We are pleased and indeed sympathize with your submissions in that letter.

As finance lawyers with special interest in Capital Market transactions, we have been briefed by an affected shareholder of Sterling Bank on this matter. We have thus reviewed the series of events before, during and after the purported reconstruction of Sterling Bank’s shares. We have visited and interviewed the Managing Director of Sterling Registrars Limited on this matter.

Furthermore, we have critically examined the various Nigerian laws relating to reconstruction of company shares and have not found any legal basis for the said share reconstruction. It is indeed appalling that the regulatory agencies in Nigeria, namely SEC, NSE, CBN and NDIC which are supposed to protect innocent and unsuspecting investors actually approved this exercise. Expectedly, Sterling Bank seems convinced that once the said share reconstruction was approved by the relevant regulatory agencies and sanctioned by the court, it was infallible. This cannot be the case in the face of glaring fraud and irregularity.

To this end, we seek to join force with you in this fight for justice. Our desire to pursue this course is not for the sake of our client for whom we have already commenced the process of seeking redress, but for helpless and vulnerable Nigerians whose hard-earned monies have been swindled by this corporate recklessness and fraud.

Thus, we lend our support to the call for a class action against the Bank regarding this fraud. We share your view that the proper means of correcting this anomaly is for all affected shareholders to come together and institute a class action to seek court order mandating the company to either effect a price adjustment of its shares or reverse the reduced shares to their previous number.

We are willing to partner with you and other investors whose shares have been affected by this illegal act by the management of Sterling Bank Plc.

We look forward to hearing from you on this issue.

Yours faithfully,


Othuke Okpighe, LLM (Ibadan) othuks@yahoo.co.uk
Chukwuka Eze, LLM (Dalhousie) chuksnkemeze@yahoo.com
Adegoke Arowosebe, LLB (Ife) princegoke79@yahoo.com

Note:
I suggest that we fight these criminals in several fronts. we may engage in a class action lawsuit and still petition authorities such as NSE, SEC, EFCC and the Central Bank. yesterday, i sent a letter to Senator Ganiyu Solomon, chairman capital markets committee.

i suggest that we use the newspaper ad to solicit names of affected shareholders for the purpose of the class action. in the petition to the authorities, it is important to list some names of shareholders who are petition on behalf of others.

thanks guys.

[zainabusman]

Originally Posted by rcmonline

This is an email i received from a law firm regarding the reconstruction:

Note:
I suggest that we fight these criminals in several fronts. we may engage in a class action lawsuit and still petition authorities such as NSE, SEC, EFCC and the Central Bank. yesterday, i sent a letter to Senator Ganiyu Solomon, chairman capital markets committee.

i suggest that we use the newspaper ad to solicit names of affected shareholders for the purpose of the class action. in the petition to the authorities, it is important to list some names of shareholders who are petition on behalf of others.

thanks guys.

You are doing a good job.

We have asked forum members who own sterling bank shares to provide details in the past. However only a few responded. I am therefore calling on all sterling shareholders to forward their names to myself or olusolakemmy. We would include the names of those who are willing to be included in the petition.

[Michael]

Originally Posted by rcmonline

This is an email i received from a law firm regarding the reconstruction:

Dear Mr. Okoye:

Good morning. We read your letter to the Director-General of the Nigerian Stock Exchange, Prof. (Mrs.) Ndi Okereke-Onyuike dated September 19, 2008 on the above subject-matter. We are pleased and indeed sympathize with your submissions in that letter.

As finance lawyers with special interest in Capital Market transactions, we have been briefed by an affected shareholder of Sterling Bank on this matter. We have thus reviewed the series of events before, during and after the purported reconstruction of Sterling Bank’s shares. We have visited and interviewed the Managing Director of Sterling Registrars Limited on this matter.

Furthermore, we have critically examined the various Nigerian laws relating to reconstruction of company shares and have not found any legal basis for the said share reconstruction. It is indeed appalling that the regulatory agencies in Nigeria, namely SEC, NSE, CBN and NDIC which are supposed to protect innocent and unsuspecting investors actually approved this exercise. Expectedly, Sterling Bank seems convinced that once the said share reconstruction was approved by the relevant regulatory agencies and sanctioned by the court, it was infallible. This cannot be the case in the face of glaring fraud and irregularity.

To this end, we seek to join force with you in this fight for justice. Our desire to pursue this course is not for the sake of our client for whom we have already commenced the process of seeking redress, but for helpless and vulnerable Nigerians whose hard-earned monies have been swindled by this corporate recklessness and fraud.

Thus, we lend our support to the call for a class action against the Bank regarding this fraud. We share your view that the proper means of correcting this anomaly is for all affected shareholders to come together and institute a class action to seek court order mandating the company to either effect a price adjustment of its shares or reverse the reduced shares to their previous number.

We are willing to partner with you and other investors whose shares have been affected by this illegal act by the management of Sterling Bank Plc.

We look forward to hearing from you on this issue.

Yours faithfully,


Othuke Okpighe, LLM (Ibadan) othuks@yahoo.co.uk
Chukwuka Eze, LLM (Dalhousie) chuksnkemeze@yahoo.com
Adegoke Arowosebe, LLB (Ife) princegoke79@yahoo.com

Note:
I suggest that we fight these criminals in several fronts. we may engage in a class action lawsuit and still petition authorities such as NSE, SEC, EFCC and the Central Bank. yesterday, i sent a letter to Senator Ganiyu Solomon, chairman capital markets committee.

i suggest that we use the newspaper ad to solicit names of affected shareholders for the purpose of the class action. in the petition to the authorities, it is important to list some names of shareholders who are petition on behalf of others.

thanks guys.

Who says you have to be in Power to make a difference. I have copied this letter and will attach it to all my friends. I don't have Sterling bank shares but I will try and find those of my friends that did at the time of the reconstruction.
People need to be shown that crime doesn't pay!

[olusolakemmy]

Originally Posted by Michael

Who says you have to be in Power to make a difference. I have copied this letter and will attach it to all my friends. I don't have Sterling bank shares but I will try and find those of my friends that did at the time of the reconstruction.
People need to be shown that crime doesn't pay!

u really do not have to be in power to make changes.

please whatever means you can help, we will appreciate it

dont also forget that you promise to help with your friend at IST.

thanks