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Business - November 12, 2018

Acquisition: Access Bank set to take over Diamond Bank

Herbert Wigwe, Access Bank GMD.

Talks have reached an advance stage for the acquisition of Diamond Bank by Access Bank.

The Nation gathered that all things being equal, Diamond Bank portfolio in few months will be taken over by Access Bank.

Quoting sources close to the deal, the paper said talks on the acquisition are on, that will see the fusion which is set for  the first quarter of next year.

It was gathered that both financial institutions have reached an agreement in broad terms on the acquisition. What is left is the valuation of assets, with a view to determining the level of compensation  and systems’ integration, the sources said, pleading not to be named because they are not allowed to talk to the media on the matter.

It was learnt that the development leading to the impending acquisition was triggered by Diamond Bank directors who approached Access Bank for intervention in a bid to stave off  a possible regulatory intervention that could lead to the withdrawal of the lender’s operating licence in the light of the bank’s depleting capital adequacy ratio on account of a huge  Non Performing Loans (NPLs) portfolio put at over N150billion.

“It’s a complete acquisition and not a merger,” a source, who asked not to be identified, but who is familiar with the transaction, said, adding that one of the major considerations that swayed Access Bank’s directors in accepting the offer was the large branch network of the lender. “ It’s burgeoning NPLs,  however,  was of serious concern to Access Bank and almost becoming a disincentive, but  it has been addressed,” the source added.

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