The Central Bank of Kenya (CBK) has announced that from the 1st of October 2019 the Commercial Bank of Africa (CBA) and NIC Bank will begin operating as one entity, following approval by the National Treasury Acting Cabinet Secretary; Ukur Yattani on the 20th of September 2019 in line with Section 9 of the Banking Act.
The merger which had been approved by the Central Bank of Kenya (CBK) on the 27th of August 2019, will take effect on the 30th of September 2019.
The new bank will beknown as NCBA Bank Kenya PLC.
The Central Bank of Kenya (CBK) stated that, “Following the merger, effective October 1, 2019, all subsidiaries will operate under a Non-Operating Holding Company, NCBA Group PLC. The banking business in Kenya of the merged institutions will operate as NCBA Bank Kenya PLC. All account holders, depositors, employees, creditors and other stakeholders of the existing institutions should deal with NCBA Bank Kenya PLC and NCBA Group PLC.”
The Central Bank of Kenya (CBK) also added that the merger will strengthen both institutions and will leverage on their combined market share of 9.9% and the customer base of over 40 million in four East African countries.
According to Business Today, Data from the Central Bank of Kenya (CBK), revealed that in the period which ended in September 2018 Commercial Bank of Africa (CBA) had an estimated 21.5 million deposit accounts, compared to NIC Bank’s estimate of 116,000 accounts during the same period.
The Commercial Bank of Africa (CBA), which is owned by the Kenyatta family, is a Tier 1 bank with an asset base of 242.6 billion Kenyan Shillings and a market share of 5.6% with both banking and non-banking subsidiaries in Kenya, Rwanda, Tanzania, and Uganda.
NIC Bank which is owned by Duncan Ndegwa is a Tier 2 Bank with an asset base of 201.0 billion Kenyan Shillings as of the 3rd quarter of 2018. The company had a market share of 4.3% with a presence in Kenya, Tanzania and Uganda.
