The bank’s CEO Herbert Wigwe said Access will shore up
Grobank’s capital.
With the acquisition, Access Bank has become the first
Nigerian lender to venture into South Africa.
Access took on both equity and debt in the South African
bank, part of a regional expansion to tap into correspondent and trade banking
deals on the continent, Herbert Wigwe told CNBC Africa Television.
He did not disclose the exact stake size.
Nigerian lenders have been seeking new avenues to boost
profit amid slow economic growth at home, a drop in government bond yields and
a rise in restructured loans due to the impact of the coronavirus pandemic.
Access Bank is expanding across the continent to counter
stagflation at home and dollar shortages that have frustrated businesses.
The latest deal brings its African presence to nine
countries, behind UBA, which has presence in 20 African countries.
“We have a full retail banking licence in South Africa,”
Wigwe said.
“We will pursue a wholesale banking franchise. We will
pursue trade finance,” he said, adding that Grobank is focused on the
agribusiness and foods sector in South Africa.
South Africa’s banking sector is dominated by four top lenders
that vie to grow profits in an economy that has been weakened further by the
COVID-19 pandemic and seen rising impairments for bad loans.
Wigwe acknowledged the competitive landscape in South Africa
but said he saw opportunities to connect the region, especially with the launch
of the Africa free-trade area this year, and provide banking services to
customers across the continent.
Access, with more than $16 billion of assets and a focus on
corporate and retail banking, is restructuring its Nigerian business into a
holding company.
Wigwe said the lender will support Grobank with more
capital, but did not give details.
In August, Access Bank agreed to buy Zambia’s loss-making
Cavmont Bank and in January last year it acquired Kenya’s Transnational Bank
with the aim of pursuing more acquisitions on the continent.
*Reuters/NAN
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