Standard Bank eyes Kenyan expansion

Standard Bank’s Kenyan unit is in talks to acquire NCBA, according to people with knowledge of the matter, a move that would potentially create the East African nation’s third-biggest lender by assets. 

The continent’s biggest bank by assets holds a 75% stake in Nairobi-based Stanbic, which has received internal approvals for the talks with NCBA, according to some of people, who asked not to be identified as the information is still private. 

Chief executive officers from the two Kenyan banks – Joshua Oigara at Stanbic and John Gachora at NCBA – didn’t respond to emails seeking comment. Standard Bank — which has said previously its priority is to grow its East Africa market share organically — declined to comment and said any announcements would be made through regulatory channels.

The combined entity will have assets close to 1.1 trillion shillings ($8.5 billion), according to their latest filings, which would make it the biggest after Equity Group and KCB.

NCBA is currently valued at about 114 billion shillings and has seen its share price surge 40% in the past 12 months.

Talks are ongoing and there is no guarantee that a deal will be finalized, although plans are to try and conclude a transaction in coming months, said the people. 

Kenya is home to close to 40 commercial banks and authorities have been urging consolidation to form more resilient lenders with deeper pockets to cater to a rapidly expanding region with a young and growing population.