By Modupe Gbadeyanka
In order not to be caught unawares, some investors having shares of Diamond Bank Plc in their portfolio are beginning to offload them as a result of uncertainty over the financial institution’s future.
In recent times, Diamond Bank has not been churning out good results, a development Business Post gathered has given some shareholders of the mid-tier lender sleepless nights.
For example, the 2017 full year financial statements of Diamond Bank was nothing to write home about and just when some observers and investors thought things would get better in the first quarter of 2018, their expectations were cut short as the firm further failed to impress.
In its second quarter 2018 results, things did not get any better and so also in the third quarter.
In late September 2018, the Central Bank of Nigeria (CBN) revoked the operating licence of Skye Bank Plc, making shareholders of the lender lose their hard-earned money. This development triggered panic in the banking sector, especially among those in the same tier with Skye Bank, which the bank in focus is among.
Making matter worse for Diamond Bank was the downgrading of firm’s long and short-term issuer credit ratings by S&P as well as the recent reports of a possible acquisition of the company by a tier-1 bank, Access Bank Plc, though both have since denied this.
But what seemed to be more confusing was the resignation of Chairman of the bank, Mr Oluseyi Bickersteth, and three other directors last month, which reports said was to allow the rumoured new investors have their own representatives on the board of the firm.
Even Mr Bickersteth was quoted as saying in an interview that the board considered selling Diamond Bank to another bank, which the present management has described as untrue.
However, in order not to fall into a similar situation with Skye Bank, shareholders of Diamond Bank are already selling off their holdings, Business Post has learnt.
According to data from the Nigerian Stock Exchange (NSE), trading in Diamond Bank Plc, Ikeja Hotel Plc, and FBN Holdings Plc, (measured by volume) accounted for 708 million shares worth N1.8 billion in 1,957 deals, contributing 55.11 percent and 15.23 percent to the total equity turnover volume and value respectively last week.
Also, Diamond Bank, which opened last week at N1.28k per share, closed last Friday at 90 Kobo per share, indicating as 29.69 percent loss in one trading week.
But despite the troubles, the CEO of Diamond Bank, Mr Uzoma Dozie, has expressed optimism that all will be well.
According to him, the conclusion of the sale of Diamond Bank’s subsidiary in the United Kingdom this quarter and other strategies being put in place should propel the company back to profitability.
“As we move into the final quarter of the year, we expect headwinds to continue driven by emerging situations in developed economies as well as our domestic political realities.
“Despite this, our investors can expect a further decline in Non-Performing Loans (NPLs), a further increase in our digital footprint and completion of the sale of the UK subsidiary.
“Through these actions, we remain optimistic about the medium to long term outlook of Diamond Bank and its return to strong profitability,” Mr Dozie was quoted as saying in a statement issued last week by bank’s PR agency, Prize Communications Limited, which was obtained by Business Post.
Whether investors will take Mr Dozie for his words is one thing many cannot answer at the moment especially when some have blamed him for the bank’s recent misfortunes. In fact, some have even started to call for his removal as Diamond Bank MD/CEO.
more recommended stories
COVID-19: Keystone Bank Trains SMEs for Better Sales
By Dipo Olowookere The need for.
Ecobank Nigeria Extends Agric Loan to 70,000 Farmers
By Dipo Olowookere Over 70,000 farmers.
Access Bank Holds Merger Talks With Another Bank
By Dipo Olowookere Nigerian lender, Access.
UBA Shares Jump 2.5% on Announcement of Two New Deputy MDs
By Adedapo Adesanya The stock price.
Access Bank to Reward Over 1,000 Customers July 15
By Dipo Olowookere Not less than.
Stanbic IBTC Upgrades Mobile App for Seamless Transactions
By Modupe Gbadeyanka New exciting features.
COVID-19: Heritage Bank Disinfects Ikeja Branch
An Experience Centre (EC) branch of.
Ecobank Nigeria Reaffirms Support for Agric, SMEs
By Modupe Gbadeyanka Stakeholders in the.