SOUTH AFRICA – In a move to exit its major shareholding in African Bank, the SA Reserve Bank (SARB) has issued the lender with a request for proposal to appoint a transaction advisor to assist with the future sale of its shareholding.
These shareholders support the Reserve Bank’s decision to appoint a transaction advisor and to commence a process to exit its shareholding.
The Reserve bank acquired its 50 percent shareholding in African Bank Holdings in 2016 as part of the restructuring of African Bank Limited – renamed Residual Debt Services – after the bank was placed under curatorship in 2014.
The Reserve Bank had publicly stated that it was never its intention to hold this equity stake indefinitely, particularly because its shareholding created a potential conflict of interest between its role as a regulator of African Bank and as a major shareholder of the group.
Part of the statement stated that since the new African Bank began operations in April 2016, the Bank has made good progress towards achieving its strategic objectives, while increasing profits and building a stronger balance sheet.
The SARB believes that this is an opportune time for African Bank to obtain a long-term sustainable shareholder who is better aligned to the Bank’s growth aspirations
“The SARB has therefore issued an RFP to appoint a transaction advisor to assist the SARB in determining the scope and approach for the disposal. The SARB anticipates that the disposal process will be completed within 18 – 24 months after the identification of a suitable buyer,” reads the statement.
African Bank chief executive Basani Maluleke said the lender appreciated the support received from the Reserve Bank as a major shareholder since 2016.
“We have always been mindful that their shareholding is short term in nature.
“Our customers can rest assured that this process will have no impact on our on-going efforts to advance their lives by providing relevant and affordable financial products together with great customer service.
“Our investors can also be assured that we remain committed to growing African Bank’s image as a trusted bank and a significant player in the banking sector,” said Maluleke.
The Reserve Bank said it would continue to support the bank as its major shareholder until the conclusion of the disposal process.