Nigeria’s biggest bank by assets, Access Bank in advanced stages of acquiring the KCB Group-owned National Bank of Kenya (NBK), five months after the deal was expected to close.
If completed, the acquisition will mark a significant milestone in Access Bank’s pan-African expansion, giving it a stronger foothold in Kenya—East Africa’s largest economy and a major financial hub.
KCB Group CEO Paul Russo confirmed on Wednesday that the acquisition is still on track, saying KCB has included NBK’s performance in its 2024 full-year results.
“We are at advanced stages of regulatory approval from both sides. I am very confident that we are at the tail,” Russo said during the bank’s FY 2024 results announcement.
In October 2024, Kenya’s Competition Authority (CAK) approved the transaction on condition that Access Bank retains at least 80% of NBK’s 1,384-man workforce for one year after the acquisition. Access Bank was also directed to retain all 316 employees of Access Bank Kenya, its local subsidiary. CAK’s approval brought the deal one step closer to completion.
“We extended the long stop date to February of this year because we hadn’t gotten all the regulatory approvals,” said KCB Group’s CFO Lawrence Kimathi. “Within that period, we got approval from the CBN, so the only approval that’s remaining is from the Central Bank of Kenya. Access themselves have written to our regulator to say that they are keen to close this transaction.”
KCB’s 2024 financial results reflected the impact of the pending sale. The lender reported a KES 2.0 trillion ($15.4 billion) balance sheet, the largest in the region. However, total assets declined by 10%, largely due to the appreciation of the Kenya shilling against regional currencies.
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Deposits and loans also dropped, further impacted by the reclassification of NBK balances to other assets and liabilities. Loans grew by 10.5%, while deposits shrunk by 0.1%, excluding NBK’s impact.
The deal’s value remains undisclosed, but KCB previously agreed to sell NBK at 1.25 times its book value, suggesting a price of around $100 million based on NBK’s $79.77 million book value in 2023.
Access Bank, which operates 23 branches in 12 counties, will significantly expand its reach by acquiring NBK’s 77 branches in 28 counties. Despite this growth, the merged entity will hold a modest 1.9% market share, which CAK says won’t impact competition, given the dominance of banks like Equity, Co-operative, and Standard Chartered.
Currently ranked 37th out of 39 licensed banks in Kenya, Access Bank is a tier 3 lender. Acquiring NBK, a tier 2 bank, will strengthen its position and growth prospects in the market.
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Source: Techcabal
