Access Bank, Diamond Bank shareholders endorse merger

By Ihesiulo Grace

6 March 2019

Business

Shareholders of Access Bank Plc and Diamond Bank Plc on Tuesday unanimously gave the nod to a merger between the two commercial lenders.

The merger, which will make Access Bank the biggest bank in Africa, received a boost when investors of both banks at a Court Ordered Meeting (COM) held yesterday in Lagos gave their consent that all assets, liabilities and undertaking including real property and intellectual property rights of Diamond Bank would be transferred to Access Bank, thus dissolving Diamond Bank without being wound up.

Under the Scheme of Merger, Diamond Bank shareholders are to be paid one Naira per each issued and paid-up ordinary shares held as at the time of the Court-Ordered Meeting.

Speaking at the meeting, Access Bank Chief Executive Officer, Mr Herbert Wigwe, told the shareholders that the merger with Diamond Bank enables Access Bank to acquire a bank with 17 million retail customers and the most viable mobile payment platform.

Wigwe said that the expected revenue and cost synergies were material and promise significant long term value.

He noted that the bank, after the merger, would attract more opportunities such as trade finance from international partners.

“With the final merger of both banks and the status of the resulting entity as ‘the largest bank in Africa’s largest economy,’ this greatly bolsters the bank’s brand, opening doors of opportunity both in local and international markets,” he said.

Wigwe said the merger was expected to produce the largest banking group in Africa based on its number of customers with more than 29 million customers.

“The resulting entity which will maintain the brand name Access Bank, but with Diamond Bank colours, will have more than 29 million customers, 13 million of which are mobile customers,” he said.

Wigwe said the bank would be a continental force with presence in 12 countries, 3,100 ATMs and nearly 32, 000 Point of Sale.

“As a continental financial force, it is set to attract more opportunities such as trade finance from international partners seeking multinational lenders with local intelligence,” he said.

He said Diamond bank merging with “Access Bank also means, the former’s customers can enjoy access to the latter’s strong balance sheet, ubiquitous presence and solid operational structure.”

“Diamond Bank has formidable retail business with the largest retail customer base in Nigeria – over 17 million customers. Diamond Bank also has a track record of customer acquisition and lowcost liabilities generation.

“The enlarged Access Bank will serve 27 million retail customers, almost double the number customers of any other bank in Nigeria and more than any other bank in Africa”, Wigwe said.

He noted that the enlarged Access Bank’s breath scale and product range will further accelerate the financial inclusion agenda that Access Bank and Diamond Bank had pursued separately.

Wigwe, however, assured enlarged shareholders of the bank that dividend would be more robust and consistent after the exercise.

Mr Adebayo Adeleke of Independent Shareholders Association (ISAN) commended the management of Access Bank for not shortchanging shareholders on the scheme of the merger. “Quiet a lot of commendable things have been put in place and we hope court will have no other reason not to agree on the merger”, Adeleke said.

Sir Sunny Nwosu, National Coordinator (Emeritus), ISAN, who also commended Access Bank for the merger, called for special dividend to cushion the effects of dilution on shareholders.

Nwosu said integration would not be a problem for Access Bank because it had managed many “marriages” in the past.