Zambian lenders are potential acquisition targets for foreign banks seeking to expand in Africa’s largest copper producing nation, central bank Governor Michael Gondwe said.
“Some of them are from our neighboring countries,” Gondwe said in an interview yesterday in Lusaka, the capital. “There is still interest for people from outside to invest in the banking industry of this country.”
Zambia has 18 registered lenders, including the local units of South Africa’s Standard Bank Group Ltd. (SBK), and London-based Standard Chartered Plc (STAN), according to the central bank’s website. In 2011, the southern African nation reversed the sale of Finance Bank Zambia Ltd. to Johannesburg-based FirstRand Ltd. (FSR)
Gondwe declined to identify the banks which are potential takeover targets. Shares in Zambia National Commercial Bank Plc (ZANACO), or Zanaco, have gained 22 percent on the Lusaka Stock Exchange this month. The bank gained 4.6 percent to close at 0.23 kwacha a share, the highest since it listed in 2008. Rabobank International, based in Amsterdam, holds a 46 percent stake in the lender, while the government owns 25 percent.
Potential buyers have expressed interest in local banks this year, Gondwe said. Any buyers of a local bank would have to comply with capitalization rules, he said. Foreign-owned banks have until the end of this year to raise their capital to 520 million kwacha ($98 million), while local banks must hold 104 million kwacha.
Local lenders that can’t satisfy those rules may look for partners or buyers, Mataka Nkhoma, general manager at African Alliance Securities Zambia, said by phone from Lusaka. “This minimum capitalization has really changed the terrain,” he said. “It’s a bit of a shake-up.”
Smaller banks such as Investrust Ltd. and Cavmont Capital Bank Ltd. may be likely targets, Nkhoma said. First Alliance Bank Zambia Ltd.’s owners have also said they are “comfortable” with exiting or finding partners, he said.
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