Yemisi Izuora With Additional Report
Access Bank is now growing bigger after it made another big offshore investment having acquired Kenya’s Transnational Bank.
The Central Bank of Kenya, CBK, disclosed that it has approved the acquisition of 100 per cent of Transnational by Access Bank; effective February 2020.
In a statement released to local media the CBK affirmed that the move comes as a result of approval by the bank regulator and treasury which is in line with the Banking Act.
“This follows CBK’s approval on December 24, 2019; under Section 13 (4) of the Banking Act and approval by the Cabinet Secretary, National Treasury on January 6, 2020; for the acquisition under Section 9 of the Banking Act,” the statement revealed.
Further, it claims the move is aimed at strengthening the resilience of Kenya’s banking sector.
Access, which has assets of $16 billion, focuses on corporate retail banking and it is expected to boost the growth of Transantional’s business, the Kenyan central bank said in the statement.
“The acquisition is expected to strengthen the resilience of Kenya’s banking sector,” it said.
Transnational Bank Plc commenced operations in December 1985 and has assets worth Sh10.2 billion. Also, it has twenty-eight branches across Kenya.
In 2018, the bank made a loss of Sh71.8 million after registering a profit of Sh36.4 million in 2017.
On the other hand; Access Bank became Nigeria’s largest bank after merging operations with Diamond Bank.
“Access Bank has subsidiaries in the Democratic Republic of Congo (DRC), Gambia, Ghana, Nigeria, Rwanda, Sierra Leone, Zambia, and the United Kingdom. The bank also operates representative offices in China, United Arab Emirates, Lebanon, and India,” CBK statement indicates.
Meanwhile, Access plans to expand to Cameroon, Mozambique and Sierra Leone this year following the acquisition.
This was disclosed by the bank’s spokesman.
Reuters reports that the deal is the latest in Kenya’s banking sector, where a cap on lending rates; tougher supervision by the central bank and over-proliferation of lenders has sparked a consolidation round in the industry since 2017.
Patrick Njoroge, the governor of the Central bank of Kenya; disclosed in September 2019 that he expected consolidation in the industry to continue; adding that market-driven tie-ups were working.
