Business News of Friday, 8 March 2013

Source: citifmonline

FirstRand Bank hopeful of finalizing acquisition of Merchant Bank in two months

South Africa’s FirstRand Bank has hinted in its interim results last Tuesday that it expects the Bank of Ghana to finalize its acquisition of a 75% stake in Merchant Bank within the next two months.

The South African outfit made the move last year hoping to start business in that same year but this has still not materialized.

It has however hinted that its strategy when it finally starts operations in Ghana would be to solidify Merchant Bank before aggressively expanding it.

The South African Bank also hinted that it may find it difficult to use First National Bank (FNB) as a brand in Ghana because of another bank brand First National.

In Nigeria, which is expected to surpass South Africa as Africa’s largest economy, FirstRand is still looking to buy a retail bank.

FirstRand CEO, Sizwe Nxasana said his group was looking at smaller banks, including the three held by the Asset Management Corporation of Nigeria (Amcon), which holds Mainstreet, Keystone and Enterprise Bank.

The three were nationalized after the global financial crisis four years ago.

"We don’t like big cheques. We are assessing our options with the three Amcon banks, but not the big gorillas," Mr Nxasana said in an interview on Tuesday. He said the important thing in Nigeria was that FirstRand had a business in the form of Rand Merchant Bank and this would enable it to understand the Nigerian market.

In the rest of Africa, FirstRand has a presence in Botswana, Namibia, Zimbabwe, Lesotho, Swaziland, Mozambique, Tanzania and a representative office in Angola. Mr Nxasana said there was no plan yet to set up a fully fledged franchise in Angola.

FirstRand generates close to 90% of its earnings in South Africa.