Egypt’s largest private lender Commercial International Bank (CIB) has received a regulatory nod to acquire a controlling stake in Mayfair Bank.
The Central Bank of Kenya (CBK) announced on Friday that it had given the greenlight to CIB to acquire a 51 percent stake in the tier-three lender effective May 1, saying the deal will diversify and add resilience to the Kenyan banking sector.
MBL, which started operations in August 2017, operates five branches in Nairobi, Eldoret and Mombasa.
The Cairo-based lender will be the first Egyptian bank to establish a presence in Kenya.
CIB began the process of seeking regulatory approval in Egypt and Kenya for the Mayfair Bank transaction in December last year.
“The CBK announces the acquisition of 51 percent of the shareholding of Mayfair Bank Limited (MBL) by Commercial International Bank (Egypt) S. A. E (CIB) effective May 1, 2020,” the regulator said.
As of September 2017, the bank’s total assets were valued at Sh2.563 billion, with shareholder equity of Sh1.121 billion.
The bank is locally owned by 13 corporate (42 percent state) and 18 individual (58 percent) shareholders, among them politician Peter Kenneth.
CIB is expected to provide Mayfair Bank with skills, resources and infrastructure to scale up its business in an increasingly competitive banking environment that has also seen tier-one lenders such as KCB and Equity Bank seek regional expansion and revenue diversification.
CIB is the leading private-sector bank in Egypt, with a total asset base of approximately Sh2.45 trillion ($24.18 billion).
It is listed on the Egyptian Stock Exchange and London Stock Exchange and trades over the counter on the New York Stock Exchange.
It also has representative offices in the United Arab Emirates and Ethiopia.
“The acquisition of a majority stake in MBL will anchor CIB’s expansion into the East African region,” CBK added
“Its entry will also strengthen the trade and investment ties between Kenya and Egypt.”
The regulator added: The acquisition is expected to diversify and strengthen the resilience of the Kenyan banking sector.”
The transaction now deepens mergers and acquisitions in Kenya’s banking sector that is controlled by about eight large banks.