Nigerian banks have ruled out reducing their shareholding in Kenyan subsidiaries after the Central Bank of Nigeria (CBN) introduced new guidelines capping lenders’ equity investments in overseas subsidiaries at 10 percent of shareholders’ funds.

 

The new requirement was announced in early May, with banks given a 12-month compliance window to restructure their shareholdings in foreign subsidiaries or raise additional capital domestically.

The Central Bank of Kenya (CBK) said it had received briefings from the Nigerian lenders and had been assured that their plans for the Kenyan market remain unchanged.“We do not expect this new rule to impact the operations of Nigerian bank subsidiaries in Kenya. While they have briefed us on the requirements by the Central Bank of Nigeria (CBN), they have indicated that their plans for the Kenyan market remain unchanged,” CBK told The EastAfrican in an emailed response.

Capital limitsThe regulation, enforced under Section 19(8) of the CBN guidelines for financial holding companies, requires banks to reduce ownership stakes in foreign subsidiaries within 12 months.

In practice, the directive will force Nigerian lenders either to raise additional capital locally or dilute stakes in overseas operations.

Some lenders have already signalled adjustments. Earlier this month, Access Bank Plc chief executive Roosevelt Ogbonna said during an investor call in Lagos that the group would reduce equity stakes in some foreign subsidiaries to comply with the new threshold, according to Bloomberg.

Mr Ogbonna did not respond to emailed questions from The EastAfrican by press time.

Three major Nigerian lenders – Access Bank Plc, United Bank for Africa (UBA), and Guaranty Trust Bank (GTB) – operate in Kenya. In April, Zenith Bank Plc completed the acquisition of Kenya’s Paramount Bank Ltd, securing its first foothold in East Africa.

The lenders are seeking to position themselves at the centre of Africa’s trade corridors linking the continent to India, Dubai and China, while capturing financing opportunities tied to AfCFTA’s 1.3 billion-person market.

Expansion driveNigerian banks have been on an acquisition drive over the past three years, aided by attractive asset prices as European lenders such as Barclays Plc and Standard Chartered Plc scaled back operations in sub-Saharan Africa.

The expansion has also reflected the strategic ambition of Nigerian lenders to evolve into pan-African financial conglomerates.

Access Bank operates in about 14 African countries, including Ghana, Rwanda, Zambia, The Gambia, Mozambique, Kenya, South Africa, Botswana, Cameroon, Angola, Tanzania, Uganda, Sierra Leone and the Democratic Republic of Congo (DRC).

The lender entered Kenya in 2020 through the full acquisition of Transnational Bank, later rebranded as Access Bank Kenya. In 2025, it completed the acquisition of National Bank of Kenya from KCB Group Plc.

In 2024, GTB increased its stake in its Kenyan subsidiary to 76.9 percent from 71.01 percent, underlining intensifying competition among Nigerian lenders for the East African market.

GTB expanded into the region in 2013 through the acquisition of a 70 percent stake in Fina Bank Ltd, which had subsidiaries in Uganda, Rwanda and Tanzania.

UBA, meanwhile, increased its holdings in UBA Kenya and UBA Uganda Ltd by 13 percent and 11 percent respectively in 2022, signalling stronger appetite for East African banking assets.

Access Bank says it is seeking to deepen its retail banking presence across Africa and strengthen trade correspondent banking capabilities through its international subsidiaries as part of its 2023–2027 strategic plan.

The bank is also targeting expansion into global trade hubs outside Africa.

In 2024, Access Group acquired African Banking Corporation Tanzania. In 2025, it acquired the Consumer, Private and Business Banking segment of Standard Chartered Bank Tanzania Ltd.

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