Diamond Gets CBN Approval on National Banking Licence

By Nume Ekeghe

Following its application to operate as a national bank, Diamond Bank Plc yesterday announced that it had received the approval of the Central Bank of Nigeria (CBN).

The conversion to a national bank which is with immediate effect, the bank however explained would be subject to its conclusion of the sale of Diamond Bank UK. With this approval the bank would cease to operate as an international bank.

A statement from the bank explained that that the re-licencing as a national bank, “supports Diamond’s objective of streamlining its operations to focus resources on the significant opportunities in the Nigerian retail banking market, and economy as a whole.”

It added: “The move follows Diamond’s decision to sell its international operations, which included the disposal of its West African Subsidiary in 2017 and Diamond Bank UK, the sale of which is currently in its final stages.

“The change to national bank status also enables the bank to maintain a lower minimum capital requirement of 10 per cent as against 15 per cent required for international banks. This creates room for the bank to deploy more capital for stronger growth in the quarters ahead through additional investment in technology platforms, customer acquisition and expansion of loans to the critical sectors of the economy.”

The bank’s chief executive, Mr. Uzoma Dozie, CEO said: “The move to a national banking license marks a continuation of our strategy to focus on Nigeria’s significant fundamental trends, including a large underbanked population and Africa’s biggest economy.

By focusing and optimising our resources towards Nigeria and the priority area of retail banking, we will be better positioned for longer term growth and greater profitability.

“The reduction in minimum capital requirement also increases our capacity to expand the quantum of business and product services we can offer consumers, as well as representing a key step in strengthening our financial position.

“This development does not affect the bank’s ability to offer services to its clients in international locations; Rather, with focus on its domestic business being priority, the bank also intends to pay down in full, the Eurobond loan of $200 million at maturity in May 2019.

“There will be no refinancing of the loan as the intent to pay down with foreign exchange generated from its internal operations, a reflection of the solidity of its operations and funds flow in the last few years.”