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CBN, SEC Green Light for Access, Diamond Merger

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  • CBN, SEC Green Light for Access, Diamond Merger

The Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC) have approved the merger of Access Bank Plc and Diamond Bank Plc, the last major regulatory hurdle for the consummation of the business combination.

Both banks at the weekend confirmed receipt of the final approval from the financial services authorities.

The final go-ahead came on the heels of the recent approval of the merger by shareholders of both banks at a meeting specially convened by the order of the Federal High Court (FHC). The CBN and the SEC had earlier granted “approval–in-principle”, a no-objection approval, to the merger.

With the final approval of the scheme, the banks will now submit the scheme of merger to the FHC for its judicial sanction, which seals the merger.

Under the merger terms, Diamond Bank will transfer all its assets, liabilities and undertakings to Access Bank and the entire issued share capital of Diamond Bank shall be cancelled and Diamond Bank shall be dissolved without being wound up.

In exchange, Diamond Bank’s shareholders shall receive a cash consideration of N1 per share and two ordinary shares of the enlarged Access Bank for every seven ordinary shares of Diamond Bank held as at the effective date.

Access Bank will be the post-merger entity with its Group Managing Director Herbert Wigwe continuing to lead the post-merger management as chief executive. The business combination is expected to leapfrog post-merger Access Bank as Nigeria’s largest bank by total assets and one of Africa’s largest retail banks.

At the separate court-ordered meeting in Lagos, shareholders had overwhelmingly approved the scheme of merger for the business combination and authorised the directors of the banks to take such actions as may be necessary to give effect to the scheme including listing of the scheme shares on the Nigerian Stock Exchange (NSE).

Directors and management of the banks believed the merger will create significant values for all stakeholders, underlining the inherent synergies and value accretion in the business combination.

The combination is expected to form a leading Tier 1 Nigerian bank and the largest bank in Africa by number of customers, spanning three continents, 12 countries, 3,100 Automated Teller Machine (ATM), more than 33,000 Point of Sales (PoS) terminals, 27 million clients and more than 10 million mobile customers.

Diamond and Access bank share many of the same areas of focus, including women, youth, entrepreneurs and the financially excluded and will be able to further develop their positioning and market leadership in these growth sectors. Diamond Bank’s corporate customers will also be able to benefit directly from Access Bank’s corporate expertise in trade finance, cash management, treasury and corporate finance.

Wigwe said the two banks share several common values and technologies that make the business combination a seamless one.

According to him, the merger of the banks will create significant opportunities and benefits to customers, shareholders, staff and other stakeholders.

He noted that the combination of Diamond Bank’s strong retail customer franchise and Access Bank’s proven risk and capital management expertise will create a post-merger bank with strong value creation potential.

Wigwe pointed out that while the merger will lead to 19 per cent shareholding dilution, the business combina

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Banking Sector

Zenith Bank Gets Recognition for Best Corporate Governance

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Zenith Bank - Investors King

Zenith Bank Plc’s strong business ethos, ethical values, and impeccable corporate governance have been rewarded with ‘Best Corporate Governance’ Financial Services’ Africa 2021 award by the Ethical Boardroom.

The bank, in a statement yesterday, said the award, published in the June 2021 edition of The Ethical Boardroom magazine, recognised the bank’s adherence to global best practices and institutionalisation of corporate governance as well as setting an industry-wide example of best practices in that field.

Commenting on the award, Group Managing Director/Chief Executive of Zenith Bank Plc, Mr. Ebenezer Onyeagwu, said: “This recognition is a testament to our commitment to quality, accountability, fairness and transparency in our engagement with all stakeholders.

“It is also an affirmation of the bank’s professionalism, ethical conduct and sustenance of global best practices and standards which is attributable to the joint collaboration of the management and staff.”
The award comes on the heels of others and recognitions that the bank has garnered in recent times for its track record of excellent performance and commitment to global best practices.

For instance, Zenith Bank was voted as Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020; Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and 2021, and Best Corporate Governance’ Financial Services’ Africa 2020 by the Ethical Boardroom.

Also, the bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, and Number One Bank in Nigeria by Tier-1 Capital in the “2020 Top 1000 World Banks” Ranking by The Banker Magazine.

Similarly, the bank was recognised as Bank of the Decade (People’s Choice) at the THISDAY Awards 2020, Retail Bank of the year at the 2020 BusinessDay Banks and Other Financial Institutions (BOFI) Awards, and Best Company in Promotion of Good Health and Well-Being as well as Best Company in Promotion of Gender Equality and Women Empowerment at the Sustainability, Enterprise and Responsibility (SERAS) Awards 2020.

Zenith Bank has been generally adjudged a corporate governance compliant bank by the Nigerian Exchange Limited (NGX) hence its listing on the Premium Board of the Exchange.

The bank continues to sustain this reputation and reappraise its processes to ensure that its business conforms to the highest global standards at all times.

The bank places a premium on its core business strategy anchored on people, technology and service, to create value for its numerous clientele.

“With a team of dedicated professionals, the bank leverages its robust Information and Communication Technology (ICT) infrastructure to provide cutting-edge solutions and products through its network of branches and electronic/digital channels,” the statement added.

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Egypt: African Development Bank Approves Loan of €83 Million for Egypt’s Electricity Sector to Spur Economic Recovery from Covid-19

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Power - Investors King

The Board of Directors of the African Development Bank have approved an €83 million loan to finance the second phase of Egypt’s Electricity and Green Growth Support Program. The funding is part of the Bank’s budget support to the Egyptian government to strengthen its electricity infrastructure, which is expected to bolster the private sector and accelerate recovery from the Covid-19 crisis.

The program seeks to enhance the power sector’s financial sustainability, governance and operations. It will also advance the provision of clean, reliable energy to drive green growth. Egypt’s successful reforms in the sector have led to greater private investment in utility-scale renewable energy projects.

“Egypt’s Vision 2030 instills the sustainability ethos across all sectors. Energy and electricity are amongst the top sectors in Egypt’s International Development Cooperation’s portfolio, pushing towards a green reform,” said Egypt’s Minister of International Cooperation, Rania Al Mashat. “With 2021 being the year of private sector engagement, the Electricity and Green Growth Support Program will contribute towards sustainable growth and job creation and catalyze the development of Egyptian private entities,” she added.

Malinne Blomberg, the Bank’s Deputy Director General for the North Africa Region, said the African Development Bank continues to actively engage with the Egyptian government and private sector companies to support the country’s medium-term development plan and economic reforms, with a particular focus on economic infrastructure such as energy, transport, water and sanitation, as well as industrialization.

In addition to the African Development Bank, Agence Française de Développement and the Japan International Cooperation Agency have also provided financial support to Egypt’s Electricity and Green Growth Support Program.

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Zambia: African Development Bank Approves $1.4 Million Grant to Improve Household Food Security in the Wake of Covid-19

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Food Security - Investors King

The Board of Directors of the African Development Bank has approved a $1.4 million grant from the Global Agriculture and Food Security Program to reduce malnutrition among the Southern African nation’s most vulnerable households.

The Mitigating Impacts of Covid-19 on Household Food Security Project will create about 150 permanent skilled or semi-skilled positions and 40 part-time unskilled jobs in crop, livestock and fisheries value chains. The project will supply inputs for crops, livestock and aquaculture enterprises to promote good agricultural practices and increase food production. There will also be a capacity building component.

“The agriculture sector is an important source of livelihoods, employment and GDP in Zambia. Increased food supply resulting from additional grant funds will lead to more jobs, improved quality of life, and reduction of malnutrition in many impacted communities,” said Martin Fregene, African Development Bank Director of Agriculture and Agro-industry.

The project provides supplementary funds to the ongoing Agriculture Productivity and Market Enhancement Project, a $32 million grant-funded initiative also from the Global Agriculture and Food Security Program, which has been managed by the Bank in the Sinazongwe, Gwembe, Chongwe, Rufunsa, Serenje and Chitambo districts of Zambia over the past five years.

Global Agriculture and Food Security Program administrators said the six districts were selected based on poverty levels, food insecurity and malnutrition prevalence. However, with this funding and program, these districts have the potential for economic growth, and to promote crop diversification. Some 5,000 people, including 3,750 women and 1,000 youth, will benefit. Some 5,000 people will also benefit indirectly along the commodity value chains.

Since the outbreak of Covid-19, Zambia has implemented bold measures to protect the health and economic well-being of its citizens. These steps included a nationwide program to scale up agricultural diversification. The Bank’s Covid-19 Response Facility launched in 2020 has been a lifeline to member governments by providing resources to tackle the pandemic.

“The facility will consolidate the Bank’s support for Zambia’s economic diversification and impact mitigation against Covid-19,” said Mary Monyau, the Bank’s Country Manager in Zambia.

The Zambian project is in line with the Bank’s High 5 strategic priorities, specifically, Feed Africa, Industrialize Africa, and Improve the quality of life for the people of Africa. Similar Bank projects have been successfully undertaken in Malawi, Niger, Liberia, Senegal and the Gambia.

The Global Agriculture and Food Security Program was established as a response to the 2008/09 world food price crisis, following a commitment by the Group of 8 nations (G8) in September 2009 to mobilize up to $20 billion for agricultural development and food security. The World Bank supervises about half of the project portfolio of the Global Agriculture and Food Security Program. The African Development Bank managed about a quarter in December 2019, and the International Fund for Agricultural Development, 11%.

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