SAN FRANCISCO, September 30, (THEWILL) – Access Bank Plc says it has secured the initial approval from the Central Bank of Nigeria (CBN) to restructure its operating structure from a commercial banking group to a financial services Holding Company (HoldCo).
The Bank also announced definitive agreements to bolster its market position in Mozambique and another deal to enter the South African market following recent transaction with Cavmont Bank in Zambia which further embedded the bank’s presence in the SADC region, one of Africa’s most important trading blocs.
In a regulatory filing at the stock market, Access Bank stated that it has received CBN’s Approval-in-Principle to restructure to a holdco. The bank has also received regulatory approvals to commence operations in Mozambique under the name Access Bank Mozambique, S.A. (Access Bank Mozambique).
Access Bank also announced that its subsidiary, Access Bank Mozambique, has entered into a definitive agreement with ABC Holdings Limited(ABC Holdings), a wholly owned subsidiary of Atlas Mara Limited (Atlas Mara) to acquire African Banking Corporation (Moҫambique), S.A., (BancABC Mozambique) for cash, in a combination of definitive and contingent consideration.
With its strategy of delivering a robust banking operation which connects key African markets, Access Bank has also entered into a definitive agreement with GroCapital Holdings (GroCapital) to invest into Grobank Limited over two tranches.
The first is an initial cash consideration for a 49 per cent shareholding, increasing to a majority stake in the second tranche. Both tranches are subject to various regulatory approvals and the overall transaction subject to Grobank’s shareholder approvals.
GroCapital, whose shareholders include the Public Investment Corporation – Africa’s largest investment manager, and Fairfax Africa Holdings – a leading global investor, will retain an existing but diluted shareholding in Grobank.
Group Managing Director, Access Bank Plc, Mr. Herbert Wigwe said the proposed holdco structure would enable the bank to further accelerate its objectives around business diversification, improved operational efficiencies, talent retention as well as robust governance.
He said the restructuring and strategic acquisitions across the continent will result in a more connected African banking network that builds on Access Bank’s existing foundation and enhances its value proposition to stakeholders, including customers and employees.
According to him, shareholders will benefit from the economies of scale of a larger banking network, including the associated cost efficiencies arising from the bank’s federated information technology system and replication of investments in innovative products across a wider range of markets.
He outlined that a broader and connected Africa network remains a core strategic focus for geographic earnings growth and diversification, which will further enhance profitability and risk metrics.
He added that with these transactions, Access Bank will be well placed to promote regional trade finance and other cross-border banking services, further leveraging its presence in key global trade corridors in the United Arab Emirates (UAE), United Kingdom (UK), China, Lebanon and India.
He explained that the Mozambique transaction will be funded from the capital invested by the bank in Access Bank Mozambique and will result in the Access Bank Mozambique becoming the seventh largest bank in the country, up from 20th.
He pointed out that as an enlarged business, Access Bank Mozambique will have an enhanced capacity to play a more impactful role in the growth of the Mozambican economy, particularly in the emerging oil and gas sector, an industry that Access Bank has deep experience in.
He noted that a presence in South Africa will serve as a cornerstone for further momentum in delivering on Access Bank’s mission to be Africa’s gateway to the world as the proposed transaction is expected to provide access to the largest banking market in Africa and enable Access Bank to consolidate its Southern African and broader African footprint with enhanced capabilities to fulfil the needs of multi-national clients.
He said the transactions will significantly strengthen the bank’s presence in Southern Africa and further its footprint for growth in the SADC region.