Botswana Stock Exchange (BSE) listed BancABC Botswana says over time it will accord citizens and local investors more opportunity to own its shares, BusinessWeek has learnt.
This comes after the major Nigerian financier, Access Bank, snapped up the 78% equity held by ABC Holdings in BancABC Botswana. The move stirred up criticism that Batswana were not given a chance to bid for the stake before Access Bank.
The conversation around Batswana setting up a home-grown commercial bank has been going on for some time, with criticism that the Bank of Botswana has not developed a tiered access system to enable citizen-owned enterprises the opportunity to enter the local commercial banking space.
BancABC managing director, Kgotso Bannalotlhe did not elaborate on the bank’s plans for greater citizen ownership but said Batswana would have the opportunity over time.
“As per the rules and regulations of the Botswana Stock Exchange, the bank can only increase local shareholding by raising the free float over 30%,” he said.
Under the Exchange’s revised listing rules, all companies are required to have a 30% minimum free float, meaning the percentage of shares that are readily available for trading. Analysts said BancABC could also increase citizen participation by making an equity offering to local investors, which would expand its share registry and potentially dilute Access Bank’s holding.
“We are passionate about empowering locals as we will definitely localise management positions.
He said Access Bank had approached ABC Holdings for its stake, but declined to disclose the value of the deal. In announcing the deal recently, officials said the Access Bank offer represented 1.13 times the book value of ABC Holdings’ 78% stake in BancABC Botswana. As at December 2020, BancABC’s total book value was estimated at about P1.2 billion.
The transaction is expected to be finalised in the second quarter of 2021. Wigwe said Access Bank’s retail banking business has grown consistently across all income lines, driven by strong focus on consumer lending, payments and remittances, digitisation of customer journeys, and customer acquisition at scale.
Access Bank has branches in Zambia, Kenya, Nigeria, Mozambique, Ghana, Rwanda, Congo, Sierra Leone, Gambia and the United Kingdom, with plans to add two more countries this year.
“We plan to develop industry focus to support and promote the Botswana economy like green energy, sustainable mining,” he said.
The bank will also engage a brand evaluation expert in the coming weeks who will determine which brand to use between BancABC and Access Bank.
“Chances are that we will use the Access Bank name,” he said.