CAK approves full acquisition of Paramount Bank shareholding by Zenith Bank

The Authority intimated that the transaction is unlikely to lead to a substantial prevention or lessening of competition in the market for the provision of banking services in Kenya and will bolster Paramount’s financial position to ensure long-term compliance with enhanced core capital requirements.

Zenith Bank has however been required to retain Paramount's 78 employees for at least 12 months after the transaction is completed.

Zenith Bank is incorporated in Kenya, while its parent company is publicly listed on the Nigerian and London stock exchanges. It has no operations in Kenya and is involved in corporate and retail banking, wealth management, institutional banking, investment banking and other financial services.

The transaction qualified as a merger within the meaning of sections 2 and 41 of the Competition Act CAP 504 of the Laws of Kenya. 

The Act stipulates that a merger or takeover may occur when an undertaking directly or indirectly acquires control over another business within Kenya. This may happen through purchase of shares, exchange of shares or vertical integration.

Merging parties whose combined turnover or assets are over Ksh.1 billion are required to seek the Authority’s approval before implementing a proposed transaction.