FirstBank Acquires West Africa Operations of International Commercial Bank

First Bank Ltd (First Bank Commercial Banking Group), a subsidiary of FBN Holdings Plc, has announced that it has completed the acquisition of a 100% equity interest in International Commercial Bank (ICB) Ghana, ICB Sierra Leone, ICB Guinea and ICB Gambia, from the ICB Financial Group Holdings AG (ICBFGH).

FirstBank, in a statement released yesterday, said the transaction has been effected through the completion of a Conditional Sale and Purchase Agreement with ICBFGH.

As a result of the acquisition, FirstBank will consolidate its position as one of the largest corporate and retail banking financial institutions in sub-Saharan Africa (excluding South Africa). The transaction corroborates FirstBank's stated ambition to win significant market share, expand its pan-African footprint and diversify earnings, while delivering value to shareholders.

Range of Benefits
According to the bank, “The transaction has considerable strategic benefits directly aligned with FirstBank's growth plans and provides a very strong platform for regional growth as the Bank expands its operations to take advantage of opportunities across the wider continent.” It added that the expansion offers a range of benefits, including new growth options, a diversified and broader geographic earnings profile, reduced country specific risk and enhanced customer benefits.

By establishing a footprint in carefully selected African countries, the Bank expects to improve its ability to effectively serve an increasingly international profile of corporate and institutional customers.

Across ICB's West Africa operations, FirstBank has acquired existing banking operations in four new markets, with 28 branches of which 17 are in Ghana, 5 in Guinea, 4 in Gambia and 2 in Sierra Leone. ICB's West African operations employ over 600 people and their assets will enhance the Bank's balance sheet by 1.32%. With over 120,000 customer accounts and a focus on the mid-corporate, SME and retail segments, ICB provides clear alignment with the Bank's existing strategic focus.

The transaction has the support of the Boards of Directors of each of the banks involved and the relevant regulatory approvals have been obtained. The combined entity will be incorporated into the international banking operations of FirstBank, which are headquartered in Lagos, Nigeria.

FirstBank remains the leading bank in the Nigerian banking sector with a Total Asset base of ₦3.3 trillion ($21.3 billion), as at 30 June, 2013.

Geographic Footprint
The transaction expands the Bank's geographic footprint to cover 10 markets internationally, with existing operations outside Nigeria in the United Kingdom and France through its subsidiary, FBN Bank (UK) Limited. It also has representative offices in Johannesburg, Beijing and Abu Dhabi. As a first step towards establishing a broader pan-African footprint, in October 2011, the Bank acquired a new subsidiary, Banque International de Crédit (BIC), one of the leading banks in the Democratic Republic of Congo.

Commenting on the transaction, Bisi Onasanya, the Chief Executive Officer of FirstBank, said, “The acquisition of ICBGFH assets in Ghana, Guinea, Gambia and Sierra Leone fulfils the first stage of our ambitions to steadily build a broader and more diverse footprint across Africa. We are committed to developing a multi-local business model that broadens our geographic revenue base while providing enhanced service delivery to our new customers.”

Mr. Onasanya said that by leveraging the transfer of FirstBank's expertise and execution capabilities, supported by the Bank's robust risk management and corporate governance policies, there is a strong opportunity for an appreciable rise in the combined entity's asset turnover, over time, while net revenue synergies are set to improve profit margins.”