Equity Bank Kenya has signed an Assets and Liabilities Purchase Agreement with Spire Bank Limited for the purchase of certain assets and liabilities of Spire Bank.
In the proposed transaction, Equity Bank Kenya Limited will acquire approximately 20,000 deposit customers holding deposits of approximately Ksh. 1.322 billion. The bank also plans to acquire approximately 3,700 loan customers that have outstanding loan balances of Ksh. 945 million.
Dr. James Mwangi, Equity Group Managing Director and CEO (centre), William Rahedi, Spire Bank Board Chairman (right) and Joel Gachari, Mwalimu National Sacco National Chairman (right) during the partnership signing ceremony. pic.twitter.com/SSOGPYJNv0
— Equity Bank Kenya (@KeEquityBank) September 12, 2022
“Equity Bank will take on Spire Bank’s 20,000 existing depositors with a deposit of approximately KSh1,322 million and approximately 3,700 loan customers with a loan book of approximately KSh945 million,” Equity Group CEO James Mwangi said after signing the deal on Monday.
The Chairman of Mwalimu National Sacco, Joel Gachari said, “On completion of the proposed transaction on 30th November 2022, all existing depositors of Spire Bank (other than remaining deposits from Mwalimu National Sacco) will become customers of Equity Bank Kenya and enjoy a wide range of products and services through Equity’s extensive infrastructure and channels including branches, agent network and digital self-service channels.
Equity Group CEO, James Mwangi, & the Chairman of Mwalimu National Sacco, Joel Gachari, speaking to the Assets and Liabilities Purchase Agreement inked by the two entities. pic.twitter.com/8kFUp3mVwb
— Julians Amboko (@AmbokoJH) September 12, 2022
In its unaudited half-year financial report as at June 2022, Spire Bank reported total customer deposits liabilities of Ksh. 1.938 billion and net loans and advances to customers of Ksh.1.745 billion. They also have additional statutory loan loss reserves of Ksh. 800 million and statutory loan loss provisions of Ksh. 945 million.
The Central Bank of Kenya (CBK) said on Monday that it had been advised by both Equity and Spire Bank of the proposed acquisition, which it said was subject to regulatory approvals.
Spire Bank, formerly known as Equatorial Commercial Bank Limited (ECB), started operations in 1984 as a non-bank financial institution and converted into a commercial bank on December 13, 1995.
In December 2014, Mwalimu National Cooperative Savings and Credit Society Limited (Mwalimu National) acquired a majority stake in ECB. Effective May 20, 2016, the bank changed its name to Spire Bank Limited.
“CBK welcomes the transaction which will enhance the stability of the Kenyan banking sector. Further updates will be provided as the transaction progresses,” the CBK said in a statement.