Banking Briefs
ACCESS Bank Plc has announced that it received the Central Bank of Nigeria’s, CBN, approval-in-principle to restructure its operations into a holding company (HoldCo) banking model. The bank said the proposed HoldCo structure would enable it further accelerate its objectives around business diversification, improved operational efficiencies, talent retention as well as robust governance.
Access Bank in a statement posted on the Nigerian Stock Exchange, NSE, website, which was signed by Sunday Ekwuochi, its company secretary, said that further details regarding the proposed HoldCo structure would be communicated to the market in due course. In addition, the bank also announced definitive agreements to bolster its market position in Mozambique as well as to enter the South African market.
“This follows the recent transaction with Cavmont Bank in Zambia and further embeds the bank’s presence in the SADC region, one of Africa’s most important trading blocs. These transactions will result in a more connected African banking network that builds on Access Bank’s existing foundation and enhances its value proposition to stakeholders, including customers and employees.
“Shareholders will benefit from the economies of scale of a larger banking network, including the associated cost efficiencies arising from the bank’s federated IT system and replication of investments in innovative products across a wider range of markets,” it stated.
According to the bank, a broader and connected Africa network remains a core strategic focus for geographic earnings growth and diversification, which would further enhance profitability and risk metrics. Through these transactions, Access Bank stated that it would be well placed to promote regional trade finance and other cross-border banking services, further leveraging its presence in key global trade corridors in the UAE, the UK, China, Lebanon and India.
Furthermore, it announces that it has received regulatory approvals to commence operations in Mozambique under the name Access Bank Mozambique, S.A. It also announced that its subsidiary, Access Bank Mozambique, has entered into a definitive agreement with ABC Holdings Limited, a wholly owned subsidiary of Atlas Mara Limited to acquire African Banking Corporation (Moçambique), S.A., for cash, in a combination of definitive and contingent consideration.
“This transaction will be funded from the capital invested by the bank in Access Bank Mozambique and will result in the Access Bank Mozambique becoming the seventh largest bank in the country, up from 20th. As an enlarged business, Access Bank Mozambique will have an enhanced capacity to play a more impactful role in the growth of the Mozambican economy.”
The transaction is, however, subject to regulatory approvals and customary conditions precedent. “Building on its strategy of delivering a robust banking operation, which connects key African markets, Access Bank has entered into a definitive agreement with GroCapital Holdings to invest into Grobank Limited over two tranches.
“The first is an initial cash consideration for a 49 percent shareholding, increasing to a majority stake in the second tranche. Both tranches are subject to various regulatory approvals and the overall transaction subject to Grobank’s shareholder approvals. GroCapital, whose shareholders include the Public Investment Corporation – Africa’s largest investment manager, and Fairfax Africa Holdings – a leading global investor, will retain an existing, but diluted shareholding in Grobank.
“A presence in South Africa will serve as a cornerstone for further momentum in delivering on Access Bank’s mission to be Africa’s gateway to the world. The proposed transaction is expected to provide access to the largest banking market in Africa and enable Access Bank to consolidate its Southern African and broader African footprint with enhanced capabilities to fulfil the needs of multinational clients,” it added.
– Oct. 3, 2020 @ 11:35 GMT |
Tags: Access Bank to adopt HoldCo structure
