Jadesola Oshin
The imminent merger between Access Bank, a tier-1 lender, and Diamond Bank, Nigeria’s leading tier-2 lender, is expected to produce the largest banking group in Africa based on its number of customers. The resulting entity which will maintain the brand name Access Bank, but with Diamond Bank colors, will have more than 29 million customers, 13 million of which are mobile customers. This is more than the whole population of Ghana. With physical presence in 12 countries across three continents, and wielding 3,100 ATMs and nearly 32,000 PoS terminals, the bank is poised to be a continental force.

Already, the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC) have granted both banks an approval in principle for the merger. The final approval needed comes after the shareholders meeting convenes in the first week of March. At the latest, the whole merger process is expected to be completed in the first half of 2019, according to an official joint statement.

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With the final merger of both banks and the status of the resulting entity as ‘the largest bank in Africa’s largest economy’, this greatly bolsters the bank’s brand, opening doors of opportunity both in local and international markets. As a continental financial force, it is set to attract more opportunities such as trade finance from international partners seeking multinational lenders with local intelligence.

Also, in big banking, reputation plays a pivotal role in competition for business. Bluechip companies or major businesses court certain lenders for credit facilities not only for the credit but because the brand power and credibility of the lender vouches for the sustainability of the client in the mind of the government or its customers. The stronger the lender is, the more protection it gives the client and security in the minds of the public. Success, then begets success. Consequently, Access and Diamond bank merger status enables them acquire bigger market share and clinch business easily. These all lead to more profit and further appreciation of share value for share owners in the bank in the long run.

Diamond bank merging with Access Bank also means, the former’s customers can enjoy access to the latter’s strong balance sheet, ubiquitous presence and solid operational structure. This means more small and medium entrepreneurs getting increased access to loans and at lower interest rates. Last year, Diamond Bank gave over a billion naira in loans to this crucial sector and with marriage to a stronger balance sheet going forward, the management would be able to offer much more. The merger also means increased convenience as there are twice more branches for customers to walk in and ATMs and PoS to use within the country. Diamond Bank customers also get instant access to Access Bank branches outside Nigeria in eleven other countries and not have to worry about intra-africa money transfers or transactions, which is a major financial problem on the continent.

At a joint conference earlier, Access Bank CEO Herbert Wigwe disclosed that the bank has a 5-year plan to grow its retail business. Merging with Diamond Bank, a leader in the retail sector and pioneer of financial inclusion, helps the corporate finance giant achieve its objective. Ther merger promises to be a win win for the companies involved and their millions of customers.