March 11, 2020 / 8:50 AM / 19 days ago

RPT-UPDATE 1-Co-op Bank Kenya seeks to fully acquire Jamii Bora Bank

(Repeats to media subscribers)

NAIROBI, March 11 (Reuters) - The Co-operative Bank of Kenya has offered to fully acquire Jamii Bora Bank, the central bank said on Wednesday, in the latest instance of consolidation in the banking industry.

The 55-year old Co-op Kenya, which is mainly owned by members of the East African nation’s co-operative movement, is the fourth-largest lender, controlling 9.63% of the market with 159 outlets.

Jamii Bora is the second smallest of Kenya’s 39 lenders, with just 0.12% market share and 17 branches.

The central bank said the proposed transaction, which requires regulatory approvals, will “diversify the business models of the two institutions and enhance the stability of the Kenyan banking sector.”

Jamii Bora is mainly focused on lending to micro-enterprises. Shares of Co-op Kenya rose 3% in early trade.

There have been several mergers and acquisitions in Kenya since 2016 brought about by the failure of three mid-sized and small lenders, as well as a cap on commercial lending rates, which was removed last November.

KCB Group acquired National Bank of Kenya last year, while CBA Group merged with NIC Bank to form NCBA in a deal that completed last year.

Reporting by Omar Mohammed and Duncan Miriri, editing by Louise Heavens

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