NCBA Group Plc

Last updated

NCBA Group Plc
Type Public: NSE: NNIC  
KN: NINC
Industry Banking and finance
Founded29 September 1959;62 years ago (1959-09-29)
Headquarters Nairobi, Kenya
Key people
J.P.M.Ndegwa
Group Chairman
John Gachora
Group CEO
Products Loans, mortgages, investments, debit cards, credit cards, mobile money
RevenueIncrease2.svgAftertax:US$58 million (KES:6.09 billion) (2019) [1]
Total assets US$4.43 billion (KES:464.89 billion) (2019) [1]
Number of employees
~2,400 (2019) [2]
Website www.ncbagroup.com

NCBA Group Plc, is a financial services conglomerate in East and West Africa. The Group's headquarters are located in Nairobi, Kenya, with subsidiaries in Kenya, Tanzania, Rwanda, Uganda and Ivory Coast. [3]

Contents

Location

The group's headquarters are located along Mara Road, in the neighborhood called Upper Hill, in Nairobi, the Capital City of Kenya. The geographical coordinates of the group's headquarters are:01°17'52.0"S, 36°48'46.0"E (Latitude:-1.297778; Longitude:36.812778). [4]

Overview

NCBA Group Plc is a large financial services organization in East and West Africa, with assets valued at over US$4.43 billion (KES:464.89 billion) as of December 2019. Shareholders' equity at that time was valued at approximately US$661 million (KES:69.416 billion). [1] The group functions as a non-operating holding company for its subsidiaries in the region. As of October 2019, the group serviced an estimated 40 million customers in four East African countries and in one West African country. [3]

History

1959–1990

National Industrial Credit (NIC) was incorporated in Kenya on 29 September 1959, when South Africa-based Standard Bank and United Kingdom-based Mercantile Credit Limited jointly formed the company to provide hire purchase and installment credit finance facilities in East Africa. Standard Bank held 40 percent of the venture while Mercantile Credit held the remaining 60 percent. [5]

In 1971, NIC became a public company and was listed on the then Nairobi Stock Exchange (NSE). Barclays Bank of Kenya Limited (BBK) acquired 51 percent of NIC's total shares through the acquisition of Mercantile in the 1970s and Standard's NIC shares in the 1980s. [6]

1991–1999

Between 1993 and 1996, BBK divested its shares, selling 38 percent of its shares to the public in 1994 through a secondary market offering and the remaining 20 percent in 1996 to the First Chartered Securities Group (FCS). Because of changing trends, regulatory requirements in the Kenyan banking industry, and the need to meet growing customer requirements, NIC obtained a commercial banking license from the Central Bank of Kenya in September 1995. [7]

To effectively diversify into mainstream commercial banking, NIC merged in November 1997 with African Mercantile Bank Limited, which was then owned by FCS, by way of a share swap. The purpose of this merger was to allow NIC to enhance its market position, provide a broader and more efficient range of services to its customers, and increase the returns to shareholders. [8]

2000–2008

In 2006, NIC established an investment bank NIC Capital as a wholly owned subsidiary. In 2008, NIC through its subsidiary NIC Capital acquired a 91 percent stake in Solid Securities Limited and subsequently re-branded it to NIC Securities Limited. This acquisition gave NIC Bank Group a seat at the NSE. [9]

2009-To Date

In 2009 NIC Bank Group established NIC Insurance Agents to offer insurance brokerage and bancassurance services. In the same year, the Group made its first expansion outside Kenya through its acquisition of a 51 percent share of Savings and Finance Commercial Bank, a medium size bank in Tanzania. In December 2010, the Savings and Finance Commercial Bank was renamed NIC Bank Tanzania Limited. In 2012, the group established operations in Uganda through NC Bank Uganda. This was a greenfield investment. [10]

NIC Group logo prior to 2019 merger NIC Bank Logo.png
NIC Group logo prior to 2019 merger

In December 2018, NIC Group announced that it would be merging with Commercial Bank of Africa Group (CBA) creating Kenya's third-biggest bank. [11] The merger involved the transfer of 100 percent of the shares of CBA Group by its shareholders to NIC Group in exchange for 53 percent of the newly formed group making the deal a reverse merger. [12]

The Transaction was approved by the Kenyan regulators and shareholders by April 2019. [13] [14] As of May 2019, the merged group was still operating two sets of banks in Kenya, Uganda and Tanzania but was in the process of seeking regulatory approval to merge these business so that they can have one bank in each country and a group re-branding. [15]

Merger history

The following is an illustration of NCBA Group's major mergers and acquisitions and historical predecessors (this is not a comprehensive list):

NCBA Group Plc
NIC Bank Group  
(2017 group reorganisation) [16]
NIC Bank Ltd
 

National Industrial Credit
(est. 1959) [5]

 
 

African Mercantile Bank
(acquired 1997) [8]

 
 
 

Solid Securities Ltd
(acquired 2008) [9]

 
 

Savings and Finance Commercial Bank (Tanzania)
(acquired 2010) [10]

 
 
Commercial Bank of Africa Group
(acquired 2019) [14] [13]
 

Commercial Bank of Africa
(est. 1962) [17]

 
 

First American Bank of Kenya
United Bank of Africa (Tanzania)
(acquired 2005) [18]

 
 

Crane Bank Rwanda
(acquired 2017) [19]

 
 
 

Member companies

NCBA Group maintains the following subsidiaries, as of April 2020.

  1. NCBA Bank Kenya: Retail banking: [20] Nairobi, Kenya – 100 percent shareholding – A commercial bank in Kenya, serving individuals and businesses, focusing mainly on large corporations. This is the flagship company of the group.
  2. NCBA Investment Bank Limited: Investment banking: Nairobi, Kenya – NCBA Investment Bank was established in 2005 to offer investment banking services. The group owns all the shares in the unit. [21]
  3. NCBA Insurance Agents: Bancassurance [22] – Nairobi, Kenya – NCBA Insurance Agents offers Bancassurance services. NCBA Group owns all of the company.
  4. NCBA Bank Tanzania: Retail banking: Dar es Salaam, Tanzania. [23] After a successful rights issue in 2013, NIC Group's interest in its Tanzanian subsidiary rose from 51 percent to 68.97 percent. [24]
  5. NCBA Bank Uganda: Retail banking: Kampala, Uganda. The group owns all of the shares of the unit.
  6. NCBA Bank Rwanda: Retail banking: Kigali, Rwanda.
  7. M-Shwari Mobile Banking: Mobile money bank service: Abidjan, Ivory Coast. [25]
  8. AIG Kenya Insurance Company Limited: Offering general insurance: Nairobi, Kenya – 33.33% shareholding the balance held by the American International Group. [26]

Ownership

The stock of NCBA Bank Group listed on the Nairobi Stock Exchange, where it trades under the symbol NINC. As of December 2019, the largest shareholders in the Group's stock are as depicted in the table below:

NCBA Group Plc Stock Ownership
RankName of OwnerPercentage
1Enke Investments Limited13.21
2Ropat Nominees Limited11.93
3Livingstone Registrars Limited A/C No. 110.56
4First Chartered Securities Limited7.45
5Yana Investments Limited5.91
6ICEA LION Asset Management Limited4.23
7Others46.71
Total100.00

See also

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References

  1. 1 2 3 NCBA Group (24 March 2020). "Audited Financial Results For The Year Ended 31 December 2019" (PDF). Nairobi: NCBA Group. Retrieved 14 April 2020.
  2. ↑ International Finance (4 October 2019). "NCBA Group to begin rationalisation of branches". London: Internationalfinance.com. Retrieved 18 April 2020.
  3. 1 2 Kevin Namunwa (1 October 2019). "NIC, CBA Cement Partnership Becoming NCBA Group Plc". Nairobi: Business Today Kenya. Retrieved 15 April 2020.
  4. ↑ Google (15 April 2020). "Location of the headquarters of NCBA Group Plc" (Map). Google Maps . Google. Retrieved 15 April 2020.
  5. 1 2 "National Industrial Credit Corporation: Corporate". AIM25 . Retrieved 5 October 2015.
  6. ↑ "NIC Bank Limited". NIC Bank. Retrieved 28 May 2020.
  7. ↑ Central Bank of Kenya (2017). "Conversions to Commercial Banks in Kenya 1994 - 2008". Nairobi: Central Bank of Kenya . Retrieved 15 April 2020.
  8. 1 2 "NIC Bank Limited (Rights) - NICR (NSE): Stock Quote, Share Price, Chart, News & Profile". www.moneyhub.net. Retrieved 28 May 2020.
  9. 1 2 "NCBA Bank - Welcome to the Bank that says Go For It". NCBA Bank. Retrieved 27 May 2020.
  10. 1 2 Ismail Musa Ladu (10 December 2018). "NIC, CBA parent banks in merger negotiations". Daily Monitor . Kampala. Retrieved 15 April 2020.
  11. ↑ The Kenyan Wall Street (7 December 2018). "NIC Bank and CBA Group in Merger Talks to Create 3rd Largest Kenyan Lender". Nairobi: The Kenyan Wall Street. Retrieved 15 April 2020.
  12. ↑ Victor Juma (31 January 2019). "CBA, NIC confirm merger plan as unified banks to list on NSE". Business Daily Africa . Nairobi. Retrieved 15 April 2020.
  13. 1 2 Patrick Alushula (13 May 2019). "Regulator approves CBA-NIC merger on condition of employees retention". Business Daily Africa . Nairobi. Retrieved 15 April 2020.
  14. 1 2 Omar Mohammed (17 April 2019). Louise Heavens and Emelia Sithole-Matarise (ed.). "Kenya's NIC Group shareholders back merger with CBA". Reuters. Retrieved 15 April 2020.
  15. ↑ Paul Wafula (16 May 2019). "John Gachora picked to head NIC, CBA merged outfit". Daily Nation . Nairobi. Retrieved 15 April 2020.
  16. ↑ Mugambi Mutegi (10 August 2017). "NIC To Finalise Reorganisation This Month". Business Daily Africa . Nairobi: Nation Media Group . Retrieved 28 November 2019.
  17. ↑ "Commercial Bank of Africa Limited - Medium Term Note Programme - Information Memorandum" (PDF). Commercial Bank of Africa Limited. 21 November 2014. Retrieved 3 December 2014.[ permanent dead link ]
  18. ↑ United Bank of Africa Renamed Commercial Bank of Africa (Tanzania) In 2007 Archived 2011-07-26 at the Wayback Machine
  19. ↑ Kabona, Esiara (20 February 2018). "Commercial Bank Africa buys out Crane Bank Rwanda". The EastAfrican . Nairobi. Retrieved 14 July 2018.
  20. ↑ "NCBA Bank - Welcome to the Bank that says Go For It". NCBA Bank. Retrieved 30 May 2020.
  21. ↑ Victor Juma. "NIC raises stake in stockbrokerage unit". Business Daily Africa . Nairobi. Retrieved 15 April 2020.
  22. ↑ "Insurance". NCBA Bank. Retrieved 30 May 2020.
  23. ↑ Leonard Magomba (20 December 2010). "NIC Bank acquires Savings and Finance, invests $6m in SMEs". The EastAfrican . Nairobi. Retrieved 15 April 2020.
  24. ↑ George Ngigi (18 February 2014). "NIC taps Ecobank finance chief as it ups Tanzania stake". Business Daily Africa . Nairobi. Retrieved 15 April 2020.
  25. ↑ Mumo Muthoki (29 November 2016). "CBA to launch M-Shwari loan service in Ivory Coast next year". Daily Nation . Nairobi. Retrieved 16 April 2020.
  26. ↑ About AIG Kenya

Coordinates: 01°17′52″S36°48′46″E / 1.29778°S 36.81278°E / -1.29778; 36.81278

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