Access Bank signs merger deal with Cavmont Bank

The Zambian unit of Access Bank Group has signed a merger deal with Cavmont Bank, the latest in a series of mergers and acquisitions involving the Nigerian banking group over the past two years.

The combined bank, which will be a majority-owned subsidiary of Access Bank, is expected to become a top 10 lender in Zambia. It will boast a strong capital base of more than ZMW600m, which significantly exceeds the capital requirement for foreign-owned banks under the regulations of the country’s central bank.

“The merger will increase our scale and improve our operating leverage by enabling us to deliver our existing retail and wholesale offerings to a wider base of customers in Zambia, while positioning the bank for growth in the long-term trajectory for the country,” said Managing Director of Access Bank Zambia, Joana Bannerman.

Access will be looking to leverage on Cavmont’s strong retail, commercial and Small and Medium Enterprises loan capability, as well as a presence across seven provinces in Zambia, offering its customers a wider branch network, the group stated.

The transaction is scheduled to close in the fourth quarter of 2020 and is subject to the meeting of various conditions, which include the approval of Cavmont Capital Holdings Zambia (parent company of Cavmont Bank) shareholders, relevant regulatory agencies, as well as the local and regional competition commission authorities.

Access Bank Zambia is a subsidiary of one of the largest banking groups in Africa with a strong track record of post-merger integration. It has overseen a number of continental expansion deals that include last month’s completed acquisition of Kenya’s Transnational Bank Plc., following an earlier announcement in October 2019, as well as its receipt of full regulatory approvals and fulfilment of all conditions precedent to completion.

“The bank’s vision is to be the World’s Most Respected African Bank and our entry into the Kenyan market, a gateway to East Africa, not only brings us closer to that vision but enables our customers to tap into our extensive global network,” the bank said in a corporate disclosure on the Nigerian Stock Exchange.

Access had last year finalised a $235m “strategic merger” with Diamond Bank in Nigeria, its home country, which saw the latter transfer all its assets, liabilities and undertakings to Access.

The transaction, part of Access Bank’s five-year strategic plan for continental expansion, birthed what is now the largest bank in Africa by customer-size and one of Nigeria’s top-tier lenders with a strong capital base.

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