Nigeria's Access Bank buys loss-making Zambian Cavmont

The Zambian subsidiary of Nigeria's Access Bank has agreed to buy Cavmont Capital Holdings, the Zambian arm of Namibian financial services group Capricorn, for a nominal fee of 1 kwacha ($0.0014), Capricorn said.

The Namibian entity owns 98.03% of Cavmont Capital Holdings, which owns 100% of loss-making Cavmont Bank. Under the terms of the deal, Access Bank Zambia will acquire the entire issued ordinary share capital, assets and liabilities of Cavmont Bank.

Capricorn said on Thursday it has agreed to reinvest 300 million kwacha into the new entity as part of the agreement.

Cavmont Bank recorded a loss after tax of 19.8 million Namibian dollars ($1.14 million) in 2019, an improvement on a 46.6 million Namibian dollar loss the previous financial year.

"This merger, which will see the combined bank becoming a top 10 bank in Zambia, will increase our scale and improve our operating leverage by enabling us to deliver our existing retail and wholesale offerings to a wider base of customers," Access Bank Zambia Managing Director Joana Bannerman said.

The transaction is expected to be completed during October 2020, subject to regulatory approvals from relevant authorities.

($1 = 735.0300 kwacha)

($1 = 17.4410 Namibian dollars)

(Reporting by Nyasha Nyaungwa; Editing by Tim Cocks and Alexander Smith)