‘Mega banks deal complete by Dec’

FBC disclosed in June that it had snapped up 100% shareholding in Stanchart, which had been on the market for about one year.

FBC Holdings Limited says it plans to complete the acquisition of Standard Bank Chartered (Stanchart) Zimbabwe by the end of this year.

FBC disclosed in June that it had snapped up 100% shareholding in Stanchart, which had been on the market for about one year.

A search for new investors for Stanchart began after its London headquartered parent Standard Chartered Bank Plc announced early last year plans to carry through a series of strategic divestments across emerging markets, including Zimbabwe.

Countries also targeted under the strategy include Lebanon, Angola, Cameroon, Gambia, Sierra Leone and Jordan.

Both Stanchart and the Zimbabwe Stock Exchange listed FBC did not disclose the transaction’s value. But the deal will also see FBC taking over Stanchart’s interest in Africa Enterprise Network Trust, which holds 20,7% shareholding in property market firm, Mashonaland Holdings. In a statement accompanying the financial services group’s half year results to June 30 2023, FBC chairperson Hebert Nkala said the transaction was undergoing scrutiny by a series of regulators, including the Reserve Bank of Zimbabwe (RBZ).

“During the period under review, FBC Holdings Limited and Standard Chartered Bank entered into an agreement for the acquisition of Standard Chartered’s business in Zimbabwe, subject to the approval of the regulatory authorities, including the Reserve Bank of Zimbabwe,” Nkala said, as he shared results for the period with investors.

“An announcement of this acquisition was issued on the 8th of June 2023, while various cautionary statements have been issued for the benefit of shareholders and the investing public.

“The group is currently engaging with various regulators for the approvals associated with such transactions and it is the group’s intention to complete the acquisition before the end of 2023.

“The acquisition will result in an increase in the group’s banking market share,” he noted. The FBCH/Stanchart deal was the second biggest such transaction involving the divesture of a major lender since Barclays Bank sold its Zimbabwean unit to Malawian investors in 2018, resulting in a name change to First Capital Bank.

“All of FBCH’s regulated subsidiaries were compliant with the requisite minimum capital thresholds,” Nkala said.

“Business growth initiatives coupled with investment and hedging activities will continue to anchor capital growth drive to enhance the group’s capacity to underwrite new business.”

In a statement accompanying the result, Stanchart said: “The business is being managed on a business-as-usual basis with business decisions continuing to be aligned to ensure capital preservation and the going concern aspect of the entity.

“No major strategic shift is expected in the interim until the business is transitioned to the new shareholders.

“Business segments and finance are monitoring key performance indicators to assess the impact of the sale announcement on the business. “The legal and company secretarial unit continues to ensure compliant governance during the transition process,” it said.

The statement said Stanchart’s core capital was below the regulatory minimum capital requirement of US$30 million during the review period.

“The Reserve Bank of Zimbabwe extended the regulatory minimum capital compliance deadline to 31 December 2023 and the bank is finalising its recapitalisation processes to be compliant before the revised deadline,” Stanchart noted. The Zimbabwe dollar traded at US$1:ZW$5 739,79 on June 30 2023 and US$1:ZW$370,96 on June 30 2022.

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