JOHANNESBURG, Aug 5 – Nedbank plans to use its planned acquisition of a 66% stake in Kenya’s NCBA to expand its presence in East Africa, with a focus on corporate and investment banking, infrastructure finance, wealth management and fintech.
The South African bank said it has received most of the regulatory approvals needed to complete the $842 million deal with the remaining approvals expected by the end of the third quarter or early in the fourth quarter.
Commenting, Nedbank Chief Executive Jason Quinn, described NCBA as a strong business with capital ratios of about 20% to 21% and a consistent return on equity in the low twenties.
According to Quinn, the deal will allow Nedbank to bring its expertise in corporate and investment banking to the Kenyan lender, including foreign exchange, bonds, commodities trading and infrastructure finance.
He said the bank also sees opportunities as Kenya and other East African countries continue investing in infrastructure, particularly in renewable energy, minerals and other major projects. Quinn added that wealth management is another area where the bank believes there is room for growth.
Beyond banking services, Nedbank is also looking at NCBA’s fintech business. Quinn said the bank’s Loop fintech platform offers expertise that could be expanded into other markets, including South Africa.
The acquisition will also strengthen Nedbank’s presence in East Africa, with Kenya serving as a regional hub and NCBA’s operations in Tanzania, Rwanda and Uganda providing further growth opportunities.
Meanwhile, Nedbank reported headline earnings of 8.4 billion rand for the six months ended June 30, up slightly from 8.3 billion rand a year earlier. The bank said higher income helped offset a 26% increase in impairment charges, while both net interest income and non-interest income recorded growth during the period.
