BoT queries Barclays Bank merger with NBC

BAK

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BoT queries Barclays Bank merger with NBC

THISDAY REPORTER
Dar es Salaam

THE National Bank of Commerce Limited's plans to buy a controlling stake in Barclays Bank (Tanzania) Limited could be 'temporarily delayed' because of queries about the deal from the Bank of Tanzania (BoT), it has been disclosed.

Impeccable banking sector sources have told THISDAY that the central bank, acting in its capacity as regulator of all financial services, has put a hold on the pending merger of the two banks.

They said the BoT, through its banking and supervision directorate is demanding certain reassurances from NBC before it can officially approve the planned take-over of Barclays Bank.

''Among other things, the central bank wants solid guarantees that all shareholders of NBC are okay with the merger of the two banks,'' said one well-placed source.

It is understood that the BoT has also asked the NBC management to confirm that the bank's three shareholders have endorsed the valuation of Barclays Bank's net worth.

South Africa's banking giant ABSA Group Limited is the majority shareholder in NBC with a 55 per cent stake in NBC. Other shareholders are the government (30 per cent) and the International Finance Corporation - private sector lending arm of the World Bank - with 15 per cent.

The banking sector sources described the BoT queries about the imminent merger of the two banks as just 'temporary delays', saying the deal is still on course to be concluded by next month.

Another source confirmed that the ABSA Group, in its capacity as majority shareholder in NBC, is actually the driving force behind the takeover bid as part of its common strategy for Tanzania and a number of other African countries.

''Being minority shareholders, I don't think the government or IFC can do anything to stop the deal from going ahead even if they disapprove of it,'' the source said

Details of NBC's take-over bid for Barclays Bank (Tanzania) are still somewhat sketchy and it remains uncertain how much the whole deal will be worth, although it has already been touted far and wide as the biggest-ever merger in the country's banking history.

Privatized in 2000, NBC remains the largest commercial bank in the country with 35 branches and 52 automated teller machines (ATMs) in total.

On the other hand, Barclays Bank has also recently consolidated its position in local retail banking by opening ten new branches in Tanzania.

After the UK Barclays Bank franchise purchased a 56.4 per cent stake in ABSA, the bank's South African bank took over the running of Barclays' South African subsidiary at the start of 2006.

According to our industry sources, the plan is that in the coming five years ABSA takes over all Barclays Bank operations on the continent (with the exception of Egypt) through a series of similar acquisitions, which could make ABSA-Barclays the largest bank in Africa.

Apart from Tanzania, Barclays Bank is also operating in South Africa, Botswana, Egypt, Ghana, Kenya, Nigeria, Uganda, Zambia and Zimbabwe.

Latest media reports from Zimbabwe say the ABSA Group also plans to buy a 67.7 per cent stake in Barclays Bank (Zimbabwe) in a deal believed to be similar to the pending take-over bid in Tanzania.
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Bowbow

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Hii nabari ni nyeti sana kwa wale wanaojua atheri za merger especially kwenye financial sector.

Nafikiri BoT inapaswa kuzuia hii merger kwa maana NBC ina subsancial market share na Barclays nao wana market share kubwa so kama wakimerge wata acquire market share kubwa ambayo wanaweza kuwa na somesort of monopoly power au thus affects consumers.

Nalifanyia kazi hili and will come with cogret report
 

Fundi Mchundo

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Fundi Mchundo

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Tutazuiaje ikiwa Barclays wameishainunua ABSA, the parent company? Of course baada ya kufanya hivi wanahitaji kurationalise activities zao na kuconsolidate pale wanapoweza. Kwa nini ABSA (NBC) waendelee kushindana na wenzao Barclays wakati wote ni wamoja?
 

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Kumbe walikuwa hawajaelewana!

African banking: Barclays and Absa fall out over bank sales
by Sudip Roy

Cross-border partnerships are tricky at the best of times. Each side tends to be wary of the other. Often cultural differences come to the fore. And then there's the internal politics. So the failure of Barclays and Absa, the South African bank in which Barclays holds a 60% stake, to reach agreement on the sale of the UK bank's other African businesses will only reinforce the impression that the relationship is tense.

The sale of Barclays' African businesses, comprising Botswana, Ghana, Kenya, Tanzania, Uganda, Zambia and Zimbabwe, to Absa was supposed to be a key pillar behind the UK bank's investment in 2005 in the South African lender. But in late February the deal fell through as neither side could agree on the valuation. "There's a big gap between the price we're willing to pay and the price Barclays is willing to accept," said Steve Booysen, Absa's chief executive, during a televised presentation, without elaborating on the differences in valuation.

Euromoney.com
 

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Kimbunga

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Hii nabari ni nyeti sana kwa wale wanaojua atheri za merger especially kwenye financial sector.

Nafikiri BoT inapaswa kuzuia hii merger kwa maana NBC ina subsancial market share na Barclays nao wana market share kubwa so kama wakimerge wata acquire market share kubwa ambayo wanaweza kuwa na somesort of monopoly power au thus affects consumers.

Nalifanyia kazi hili and will come with cogret report

Mkuu kwani hizi ownership structures za ABSA, NBC na Barclays zikoje? Mbona naona hapa kuna a three angle relationship; ABSA ni majority shareholders wa NBC na Barclays ni majority shareholders wa ABSA (55%)
 

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