CFC Stanbic Bank

CFC Stanbic Bank is the official name of the proposed new entity created by the merger of the CFC and Stanbic banks’ pending approval from among others shareholders, Capital Markets Authority, Central Bank of Kenya (Minister of Finance).

The merger makes sense in that the 9th and 10th largest banks (both around $350m in assets) can merge to become the 4th largest bank in the country (after Barclays, KCB, Stanchart)

Sticking points are that the deal is structured to include the creation of new shares (113 million) that will be transferred to Stanbic in addition to buying a majority of Gambit shares (currently the largest shareholder in CFC). Gambit will still remain as the 4th largest shareholder in the bank after the merger.

To sweeten the deal, CFC Stanbic Bank will remain listed on the NSE and Stanbic Kenya will be a wholly owned subsidiary. Also, the statement points out that their branch networks complement each other, so perhaps only Mombasa (where they, and most banks, have branches on Nkrumah street) and branches in Uchumi stores may need a workout.

When the story first broke last year (despite having a caution), it sent CFC’s share price up 10X (to about 900 shillings) and this notice also advises shareholders to exercise caution in dealing their CFC shares until further announcements are made. The announcement was released on Friday (but not yet up on NSE site), and published in the newspapers on Saturday to perhaps dampen the speculative mood/euphoria and allow careful analysis to set in before Monday.

(I don’t have CFC shares but they have been very good stockbrokers to me. Unrelated to this is, I have Stanbic Uganda shares)

10 thoughts on “CFC Stanbic Bank

  1. Phil

    Not really a comment,which brokerage in Kenya caters to the diaspora, i mean a full service broker prefarably online ,like E-Trade in the US.

  2. nelie

    that should have been rankings…
    CFC group has 40 bln total assets and stanbic has 29 so total is 69 bln, still lower thank NBK with 75 bln at number 5.

  3. bankelele

    Phil: none really. They may lure you with online service promises, but they pften peter out once you sign up

    coldtusker: nada yet. I got suckered by FD two years ago ‘online’ promises

    nelie: The banks themselves for their official published 2006 which had NBK at 36 billion total assets, CFC 25.4, and Stanbic 25.8

  4. MainaT

    RE KenyaShares-site looks very amateurish afadhali Hasinet. In any case, online trading is not far-off.

    Back CFC Stanbic, watchout StanChart is all i can say…

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