HomeBusiness DigestFirst Bank merger almost complete

First Bank merger almost complete

MERGER negotiations between First Banking Corporation Ltd (First Bank), National Discount House (NDH) and Southern Africa Reinsurance Company (Sare) are now at an advanced stage with First Bank announcing the completion of diligence and c

ompany valuation exercises.

“We have been looking at the books of the organisations, their staff and level of education and how much they are worth,” First Bank’s head of public relations, Lydia Mavengere said.

She said the process of checking the books and value of the companies had been completed but they had not yet made a final decision.

NDH operates a discount house, an asset management company and a stock broking firm while First Bank concentrates on commercial banking.

First Bank is listed on the Zimbabwe Stock Exchange and if the deal succeeds it would pay dividends with the commercial bank benefiting from the consolidation of a discount house, brokerage firm and an asset management firm currently under the NDH stable.

On the other hand, NDH would also benefit cheaper equity capital from the integration with the listed company.

Speculation was rife in the market that business tycoon, Mutumwa Mawere, a majority stakeholder in First Bank, courtesy of his 51% stake in Zimre, was reluctant to be involved in the merger.

Mergers of most financial institutions have been widely anticipated following the major shake-up after the monetary policy statement announced in December.

The shakeup resulted in a liquidity crisis that faced the financial services sector. – Staff Writer.

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