The Common Market for Eastern and Southern Africa has approved Access Bank's proposed acquisition of an initial 69.67% stake, rising to as much as 80.89%, in Finance Trust Bank Uganda, removing a regulatory obstacle for the cross-border banking transaction. COMESA granted its clearance on 4 May 2024, allowing the deal to progress towards completion following its initial announcement in January 2024.
Access Bank is a Nigerian lender with operations in several African markets. Finance Trust Bank serves low-income customers in urban, peri-urban and rural areas with a particular emphasis on women, through 35 branches serving more than 500,000 savers and 42,000 borrowers.
REGULATORY PATHWAY TO COMPLETION
Despite the COMESA clearance, the transaction is not yet complete. The Bank of Uganda, which regulates commercial banking activity within the country, must still grant its own approval before any transfer of control over Finance Trust Bank can take effect.
Completion of the deal remains subject to the Bank of Uganda sign-off and the satisfaction of any remaining conditions set out in the share purchase agreement.
COMESA's mandate covers competition and market concentration across its member states. In clearing the transaction without conditions, the authority found that the merger was not likely to substantially prevent or lessen competition in the Common Market, nor be contrary to public interest. The authority found the parties' pre- and post-merger market shares were not significant.
BACKGROUND
Access Bank has pursued acquisitions and organic market entries across sub-Saharan Africa in recent years. The Nigerian bank has established or acquired presences in Kenya, Rwanda, Zambia, the Democratic Republic of Congo, Mozambique and several other markets.
Finance Trust Bank Uganda began in 1984 as Uganda Women's Finance Trust, an NGO, became a microfinance deposit-taking institution in 2004 and converted into a commercial bank in 2013.