- KCB — Kenya's biggest bank — bought National Bank of Kenya in 2019.
- Russo told an investor briefing the deal was struck at 1.25 times book value, but did not give the exact figure.
Nigeria's Access Bank is set to acquire the National Bank of Kenya from KCB Group.
The two banks signed a binding agreement in Nairobi on Wednesday.
The successful completion of the transaction is subject to conditions that are customary for transactions of this nature including receipt all regulatory approvals from, amongst others, the Central Bank of Kenya, the Central Bank of Nigeria, the COMESA Competition Commission, and notifications to other relevant regulators.
KCB Group CEO Paul Russo says the transaction represents a great opportunity to maximise shareholders' value while strengthening the competitive position of the Group.
"The past four years have been defining NBK as a KCB Group subsidiary and this step marks the opening of new opportunities,'' Russo said.
"Our growth strategy is premised on both organic and inorganic plans, and we shall continue to seek opportunities that increase our shareholder’s value."
Russo told an investor briefing the deal was struck at 1.25 times book value, but did not give the exact figure.
KCB Group shares were up 9.9 per cent following news of the deal and after posting an impressive 27 per cent growth in full-year earnings to Sh37.5 billion.
Access Bank Plc MD Roosevelt Ogbonna said the transaction represents an important milestone for the bank as it moves closer to the achievement of five-year strategic plan through increased scale in the Kenyan market.
"We are building a strong and sustainable franchise to support economic prosperity, encourage African trade, advance financial inclusion thereby empowering many to achieve their financial dreams,'' Ogbonna said.
He added that trade flows in East Africa revolve around key trade corridors, with Kenya being a key player in the region.
"With the African Continental Free Trade Agreement, these corridors will continue to expand and by deploying our best-in-class financial solutions, we are strategically positioned to deliver sustainable value for our stakeholders."
All parties will be working together in the coming months to fulfill the conditions precedent relating to the proposed acquisition, which includes the regulatory approvals of the Central Bank of Nigeria and the Central Bank of Kenya.
Access Bank will continue to provide a full range of banking services and continuity for its stakeholders including employees and customers in Kenya.
In the meantime, NBK customers will continue to access seamless services across various touchpoints including through the branch network and mobile banking platforms.
Upon conclusion, stakeholders will benefit from an enlarged franchise, with best-in-class customer service and governance structures committed to empowering the communities wherein the Bank operates.
The combined entity will leverage Access Bank's dedication to economic development by extending financial services to the unbanked, thereby deepening financial inclusion across the region.
KCB — Kenya's biggest bank — bought the National Bank of Kenya in 2019.