EDIT October 1, 2019: The merger of CBA and NIC banks became official today (Oct 1)following the receipt of final approvals from the Central Bank of Kenya and the National Treasury last week. The new entity will be called NCBA Holding company with NCBA Bank Kenya being the banking entity for the two banks who will spend this month harmonizing their different systems
Phase two will entail the consolidation of their bank entities in Tanzania, Uganda and Rwanda, while a new brand identity will be unveiled later.
Jan 31, 2019 The boards of NIC and CBA have agreed to the merger and provided further details of the deal in Nairobi.
The proposed merger will be executed through a share swap, with the 34 shareholders of CBA exchanging their shares in CBA for new shares in NIC, which will remain a publicly listed company quoted on the Nairobi Securities Exchange. #Merger2019
— NCBA (@ncbacare) January 31, 2019
— NCBA Bank (@ncbaKenya) January 31, 2019
The move is driven by a need to consolidate capital and liquidity with new technology opportunities to provide more services to customers and grow returns for shareholders.
The merger of the eight and ninth largest banks in the country will result in a banking institution that will be the second or third largest by assets, behind KCB and Equity. As of September 2018, NIC and CBA had a combined asset base of Kshs 443 billion ($4.3 billion) and Kshs 9.3 billion in pre-tax profits.
CBA is already the largest bank by customer numbers thanks to M-Shwari, its partnership with Safaricom’s M-Pesa that had over 21 million customers last year.
More details will come later and NIC is listed on the Nairobi Securities Exchange.