Business News of Tuesday, 19 July 2011

Source: citifmonline

Ecobank moves to acquire The Trust Bank

Plans are far advanced for Ecobank Transnational Incorporated (Ecobank), the parent company of the Ecobank Group to acquire a significant equity stake in The Trust Bank, Ghana Limited (TTB).

With TTB as an indigenous bank, the transaction according to Citi Business sources is aimed at meeting the Bank of Ghana’s requirement for local banks to recapitalize to the tune of Gh¢ 60 million by the end of 2012.

Ecobank, which is the only banking group with a presence in 32 African countries, has said that the transaction is to strategically create the requisite synergies to position the merged entity as the leading bank in Ghana.

Ecobank’s interest in the acquisition is said to be inspired primarily by TTB’s approach to SME banking as well as its strategic branch network.

This will ultimately, strengthen Ecobank's operations as a Pan-African bank.

The sources say the Bank of Ghana has given its consent to the deal after the resolution was passed by TTB shareholders last month.

The due legal and financial diligence is however expected to be concluded by the end of September to complete the merger process following which the specific details would be known.

Ecobank had earlier penciled down an acquisition move for First Atlantic Bank but word has it that the deal could not materialize.

The pan African bank is also rumoured to be fine-tuning moves to acquire another major indigenous bank, perhaps before the recapitalization deadline for local banks is due by the end of 2012.