By BRIAN NGUGI, bnjoroge@ke.nationmedia.com
In Summary
The Fidelity Commercial Bank Ltd board of directors
has approved a deal to sell the lender to Mauritian financial services
group SBM Holdings.
The Central Bank of Kenya (CBK) disclosed Wednesday the nod
by the board of the small sized Kenyan lender was given in an
extra-ordinary meeting of the bank's shareholders.
The moves paves the way for a share purchase
agreement (SPA) to be signed in the near future, in turn allowing
requests of the remaining regulatory approvals to be made, CBK said.
“Following SBM Group’s preparedness for the
conclusion of the transaction at the earliest, with necessary capital
infusion, FCBL held a Board meeting on December 21, 2016 and then an
Extraordinary General Meeting of shareholders on December 28, 2016 where
the transaction was discussed and approved,” said CBK in a statement.
Fidelity has been looking to sell an equity stake to a strategic investor in order to bolster its capital base.
Under the deal with SBM, which is listed on the
Mauritian bourse, the latter says it will inject Sh1.46 billion in
additional capital into Fidelity Bank once the acquisition is complete.
CBK said Wednesday that regulatory approvals in both countries would pave way for the completion of the transaction.
“The regulators in both Kenya and Mauritius have
also been kept abreast of developments. In light of the progress thus
far, it is expected that a Share Purchase Agreement (SPA) will be signed
in the near future, which would allow requests of the remaining
regulatory approvals to be made. Subject to these approvals, the
transaction will then be completed,” CBK added.
Regional debut
The proposed acquisition would mark the entry of
SBM into Kenya’s banking sector, using it as springboard into the East
African region.
Its banking arm, SBM Bank (Mauritius) Ltd, is one
of the leading banks in Mauritius with an international footprint in
India, Madagascar, and a representative office in Myanmar.
"The acquisition is in line with SBMH's regional expansion strategy into East Africa," SBM said earlier.
SBM Holdings began operations in 1973, with its
lines of business including retail and SME banking, wealth management,
treasury services, asset Financing, stockbroking and asset management.
SBM Group is expected to bring its experience and
expertise from Mauritius and other markets to enhance competitiveness in
Kenya’s banking sector.
Fidelity on the other hand began its operations as a
non-bank financial institution in 1992 before changing to a commercial
bank in 1996.
The Kenyan small sized lender currently operates 14 branches countrywide.
CBK ranked Fidelity in position 31 out of 41 banks in market share at the end of 2015, with a share of 0.39 per cent.
No comments :
Post a Comment