Kenya’s financial market braces for revolution as NIC and CBA mull merger

by David Karani
The board of directors of NIC Group PLC and Commercial Bank of Africa Limited have announced the commencement of discussions regarding a potential merger of the two entities.
“Upon successful conclusion of these discussions and subject to approvals from shareholders of the two
entities and regulatory authorities it is expected that the envisaged merger would create one of the largest
financial services groups in the region,” a joint statement from the two institutions said.
Signed by the chairmen of both banks James Ndegwa and Destario Oyatsi, the statement said It is the view of the two Boards that the potential merger would bring together the best in class retail and corporate banks with strong potential for growth in all aspects of banking and wealth management.
A combined entity would create a complementary base of over 38 million customers, a strong digital
proposition and a robust corporate and asset finance offering”,”the statement added.
The Boards believe that combining the business of two highly profitable entities would create enhanced
capacity through capital consolidation and strong liquidity to capture strategic growth opportunities, the two boards noted.
This would allow it to invest in future growth and in new technology to create enhanced offerings and wider
services to its customers, as well as deliver deeper financial inclusion while generating attractive returns
to shareholders,”the two boards noted.
A combined larger group would provide new and greater opportunities for employee development,
advancement and growth. The combined group would be strongly placed to play a bigger and more significant role in the banking sector and the economies of Kenya, the region and beyond.
It is important to note that an eventual merger remains subject to due diligence processes, shareholder,
regulatory and other approvals. During this phase of discussions the two entities will continue to operate independently,”the statement said.
The Boards of Directors  emphasized that the discussions are preliminary in nature and as such only
limited information can be disclosed at this stage.
The two entities are committed to the highest standards of governance and regulatory disclosure and will update the market as and when there are any material
developments”,”the statement concluded.
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