Equity Bank (Kenya) Limited (EBKL), has completed the acquisition of Spire Banks approximately 20,000 deposit customers holding deposits of Ksh1.322 billion and 3,700 loan customers.
The loan customers are those that have outstanding loan balances reported at a net carrying value after statutory loan loss provisions of Ksh945 million, as per Spire Bank’s un-audited 2022 half year financial statements.
The completion of the acquisition follows an announcement that was made in September 2022 indicating that EBKL had entered into a transaction with Spire Bank for the proposed acquisition.
With completion of the transaction, customers holding deposits in Spire Bank, other than the remaining deposits from Spire Bank’s controlling shareholder, and specified loan customers will now transition to become EBKL customers. This means that these customers will have new Equity Bank accounts and besides their domicile branch, they become part of a big network offering more capabilities to self-serve and enjoy banking on their mobile devices.
Speaking during the announcement ceremony, Dr. James Mwangi, Equity Group Managing Director and CEO said the decision to acquire Spire Bank’s certain assets and liabilities was not hard and was inspired largely by their history with teachers who have continued to support the Bank over the years. “This long-standing partnership extends to other collaborative initiatives including the Wings to Fly scholarship program that has benefited over 60,000 scholars. We have also partnered with our schools to support them transition to clean energy for lighting and cooking. Today, we celebrate the completion of the transaction and are happy to report we have started serving former Spire Bank customers.”
The acquisition follows receipt of regulatory approvals from the Cabinet Secretary Treasury and Planning under Section 9 (1) of the Banking Act, the Central Bank of Kenya under Section 9, (5) of the Banking Act, the Sacco Societies Regulatory Authority, the Competition Authority of Kenya, and corporate approvals from the board and shareholders of EBKL, Mwalimu National Savings & Credit Co-operative Society Limited (Mwalimu Sacco) and Spire Bank.
Also speaking at the announcement, Spire Bank Board Chairman, William Rahedi said, “Equity Bank has stepped in to support Spire Bank to finish well. We are grateful that the Bank opened its doors for us and that moving forward, we shall be part of this great institution. We appreciate all stakeholders involved in this journey and express gratitude for the dignity and respect accorded to our customers and staff during this transition process. This transaction truly sets pace for similar initiatives within the financial services sector.”
In his remarks, the Chairman of Mwalimu National Sacco, Joel Gachari said, “This is a unique transaction structured as an asset and liabilities purchase agreement. Equity will be acquiring part of our subsidiary’s assets and liabilities in the form of customer loans and deposit; and is expected to strengthen both organizations by leveraging their well-established domestic and regional client base. A move that provides confidence for consolidation in the banking sector in order to create larger and more resilient institutions that are stable and can weather shocks in this business environment.”