Nedbank gets CBK approval to acquire 66pc stake in NCBA

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South African lender Nedbank Group has received regulatory approval to acquire up to a 66 percent stake in Kenyan-listed lender NCBA Group, paving the way for the biggest change in the bank’s ownership structure since its formation.

The Central Bank of Kenya (CBK) said it approved the proposed acquisition on August 28 under Section 13(4) of the Banking Act.

“The acquisition shall take effect upon completion of the transaction in accordance with the terms of the Agreement between the two parties,” CBK stated in a statement Monday.

The acquisition will give Nedbank, one of South Africa’s largest financial services groups, a controlling stake in NCBA and deepen its presence in East Africa.

NCBA was formed in 2019 following the merger of NIC Group and Commercial Bank of Africa (CBA). The Nairobi Securities Exchange-listed group has banking operations in Kenya, Uganda, Tanzania and Rwanda, as well as a joint venture in Côte d’Ivoire.

Beyond banking, NCBA has interests in stockbroking, insurance, investment banking and leasing.

Nedbank, which is listed on the Johannesburg Stock Exchange and Namibia Securities Exchange, operates across Southern Africa through subsidiaries and banking operations in Lesotho, Mozambique, Namibia, Eswatini and Zimbabwe.

CBK said it welcomed the transaction, arguing that it would support the stability and resilience of Kenya’s banking sector while promoting competition.

Under the deal Nedbank is expected to hold 1,087,362,891 NCBA shares, equivalent to 66 percent of the lender’s issued share capital.

The remaining 560,156,641 shares, representing 34 percent of the company, will continue to be held by other shareholders.

In the arrangement, shareholders whose shares are accepted will receive cash payments on the settlement date, while accepted shares will be transferred to Nedbank through a block trade.

The approval marks a major step in the proposed transaction, although completion remains subject to the agreed transaction process.

The central bank said the acquisition will take effect upon completion of the transaction.