KCB Group offers to take over National Bank of Kenya

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NAIROBI (Reuters) – KCB Group, Kenya’s biggest lender by assets, has proposed to take over National Bank of Kenya through a share swap, to increase its share of the government’s banking business, documents seen by Reuters showed on Monday.

Kenya’s banking industry is undergoing consolidation after the closure of two mid-sized lenders and a third smaller one, in the months to April 2016, exposed weaknesses caused by corporate governance lapses.

KCB and National Bank of Kenya share the same largest shareholders, the state and the state’s pension fund, and they have both traditionally competed for the government’s banking business, including deposits.

In its proposal, KCB, which also operates in neighbouring countries, said it would initially take over 70 percent of shares of National Bank of Kenya, before announcing its offer for the remaining stake.

It said in the documents it would offer shares of KCB to the owners of National Bank of Kenya to complete the deal, but it was also open to other transaction modes.

(Reporting by Duncan Miriri, editing by Louise Heavens)

 

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