Nigeria’s major lender, Access Bank, has acquired 100 percent of a Kenyan Bank with 28 branches, the East African country’s Central Bank of Kenya (CBK) said at the weekend.
Patrick Njoroge, the governor of the central bank in Kenya, said last September that he expected consolidation in the industry to continue, adding that market-driven tie-ups were working.
Last year’s all share acquisition of National Bank of Kenya by KCB Group (KCB.NR) last year has been touted as one of the biggest deals in the Kenyan sector.
Access Bank’s acquisition of Kenya’s Transnational Bank is coming at a time the deposit money bank has also hinted of plans to expand its frontiers in Mozambique and Sierra Leone.
The top-tier Nigerian bank has operations in seven African countries and Britain as wells as representative offices in China, United Arab Emirates, Lebanon and India.
The Central Bank of Nigeria had on Wednesday gave ‘No Objection’ to the tier-one bank’s moves to open its subsidiary in Cameroon.
The deal is the latest in the East African nation’s banking sector, where a cap on lending rates, tougher supervision by the central bank and an over-proliferation of lenders has sparked a consolidation round in the industry since 2017.
Access, with over $16 billion asset base, focuses on corporate retail banking and it is expected to boost the growth of Transnational’s business, the Kenyan central bank said in a statement.
The acquisition takes effect February 1, 2020 and follows CBK’s approval on December 24, last year. Justifying the need for the deal, the CBK said the acquisition is expected to “drive Transnational Bank Plc’s business growth for the benefit of the Kenyan economy and the banking sector.”
Following its acquisition of Diamond Bank in a $235 million deal, Access became Nigeria’s biggest lender last year, a move insider said was meant to create Africa’s largest bank by customers.