South African lender Nedbank is moving closer to a major expansion into East Africa after receiving approval to acquire up to 66% of NCBA Group. The deal could place one of Kenya’s biggest banking groups under Nedbank’s control once completed.
The Central Bank of Kenya approved the proposed acquisition on August 28. The approval was granted under Section 13(4) of the Banking Act. However, the transaction is not yet complete. It will take effect after Nedbank and the relevant parties finalize the agreement.
The proposed acquisition would give Nedbank a stronger presence in East Africa. At the same time, it would add NCBA’s regional operations to its wider African footprint.
NCBA operates banking subsidiaries in Kenya, Uganda, Tanzania and Rwanda. It also has a joint venture in Côte d’Ivoire.
The Nairobi Securities Exchange-listed group was formed in 2019. It resulted from the merger between NIC Group and Commercial Bank of Africa. Besides banking, NCBA has interests in stockbroking and insurance. The group also operates in investment banking and leasing.
Meanwhile, Nedbank already has operations across Southern Africa. The lender is listed in Johannesburg and Namibia. Its regional footprint includes Lesotho, Mozambique, Namibia, Eswatini and Zimbabwe. Therefore, acquiring a controlling stake in NCBA would significantly widen its African reach.
The Central Bank of Kenya said the transaction would support stability in the banking sector. It also noted that the deal could strengthen resilience while promoting competition.
However, the regulator did not disclose the value of the transaction. It also did not provide a timeline for its completion. If the deal is finalized, Nedbank will become the controlling shareholder in NCBA Group. The acquisition would also reshape ownership in Kenya’s banking industry.