The multi-billion shilling takeover of the National Bank of Kenya (NBK) by Kenya Commercial Bank (KCB) appears to be headed to the rocks as a committee of the National Assembly has opposed the move.
The recommendation against the move is by the Finance and National Planning Committee, chaired by Kipkelion East MP Joseph Limo, that has been investigating the proposed acquisition.
Majority leader and Garissa Town MP Aden Duale tabled the committee’s report in the House on Wednesday.
The recommendations will, however, require the approval of the House.
ALTERNATIVE
The committee has recommended that NBK’s principal shareholders – the National Treasury (22.5 percent) and the National Social Security Fund (NSSF) (48.05 per cent), reject KCB’s offer to acquire 100 percent shareholding, the minority shareholders and other shareholders.
It wants Treasury to seek alternative ways to fund the lender despite fears of collapse if the planned takeover falls through.
The need for an alternative financier, according to the report set for debate when the House resumes from a long recess starting Thursday, is to ensure the bank is compliant with the Banking Act’s capital ratios so as to continue lending and taking more deposits.
