Jamii Bora changes to Kingdom Bank as Co-op completes acquisition.

The Co-operative Bank of Kenya Limited (Co-op Bank) has completed acquisition of 90 per cent of Jamii Bora Bank.

The former Jamii Bora Bank has changed its name and will now operate as Kingdom Bank Limited.

The acquisition

On March 10, 2020, Co-op Bank published a Cautionary Announcement on discussions to acquire 100 per cent shareholding in Jamii Bora Bank Limited, subject to due diligence, approvals of the respective Board of Directors and Shareholders, and approvals of the regulatory authorities notably Capital Markets Authority, Competition Authority of Kenya and Central Bank of Kenya.

The Board of Directors of Co-op Bank made an offer expressing interest to subscribe for a New Class of Ordinary Shares (Class A) in Jamii Bora Bank for an aggregate Subscription Price of Sh1 billion and which would result in Co-op Bank owning 90 per cent of the issued share capital of Jamii Bora Bank. These are 224,153,541 New ordinary shares at a total cost of Sh1 billion. The Board of Directors of Jamii Bora Bank accepted the offer made by Co-op Bank on June 3, 2020.

Jamii Bora Bank shareholders pursuant to a Special General Meeting held on July 1, 2020 unanimously resolved to allot 224,153,541 Class A ordinary shares to Co-op Bank for an aggregate subscription price of Sh1 billion which on completion of the Proposed Transaction in accordance with the terms of the Share Subscription Agreement, Co-op Bank would own 90 per cent of the issued share capital of the Company, and such New Shares shall rank pari passu in all respects with the existing ordinary shares.

Upon allotment of the New Shares, Co-op Bank would be entitled to 90 per cent of the voting rights in the Company, 90% of the distributable profits of the Company, the right to appoint all the members of the Board of Directors’ of Jamii Bora Bank in order to drive the needed Transformation Agenda.

The Capital Markets Authority and the Competition Authority of Kenya each approved the Proposed Transaction on July 6, 2020 and August 3, 2020 respectively. The acquisition will be ratified in the next annual general meeting of Co-op Bank.

Central Bank of Kenya vide a Gazette Notice No. 5475 issued on August 7, 2020 confirmed that pursuant to section 9 (1) of the Banking Act, the Cabinet Secretary Treasury, had approved the acquisition as above of 90 per cent shareholding with effect from August 21, 2020.

Following Central Bank of Kenya approvals, the former Jamii Bora Bank has changed its name and will now operate as Kingdom Bank Limited.

New Board

Pursuant to the completion of the transaction, Co-op Bank appointed a new Board chaired by Margaret Karangatha to drive the needed Transformation Agenda. Other Board members include, Macloud Malonza, Julius Sitienei, Dr Gideon Muriuki, and Anthony Mburu who is the Managing Director & CEO.

Anthony Mburu was previously the Director of Credit Management at Co-op Bank Group and is a respected Senior Executive in the banking industry with over 25 years’ experience in the region notably in Risk and Credit Management.

Affiliates

Co-op Bank Group is one of the largest banks in the region with an asset base of over Sh513 billion, pre-dominantly owned by the over 15 million member Kenya Co-operative movement.

Its subsidiaries include; The Co-operative Bank of Kenya Limited, 100 per cent of Co-optrust Investment Services Limited, 100 per cent of Co-op Consultancy & Insurance Agency Limited, 60 per cent of Kingdom Securities Limited and 51 per cent of Co-operative Bank of South Sudan Limited.

Its associates are CIC Insurance Group (24.7 per cent) and Co-op Bank Fleet Africa Leasing Limited (25 per cent).

The Group reported a pre-tax of Sh9.6 billion as at June 30, 2020.