StanChart to acquire Ghana, Nigeria banks

The Standard Chartered Bank Plc has stated its intensions to acquire some banks in Ghana and Nigeria as part of measures being considered to expand its Sub-Saharan presence.

The newly appointed Africa CEO, Diana Layfield, told Reuters that Standard Chartered Bank is looking to double its Nigerian branch network to 75 outlets by next year.

It is unclear yet which of the banks in Ghana will be acquired by the StanChart Plc as the Bank of Ghana recently reiterated it will not back down on ensuring all the banks meet the 60 million cedi recapitalisation requirement by the end of 2012.

Some of the banks are said to be struggling to meet the requirement and at a recently held event, the Governor of the BoG, Kwesi Amissah-Arthur encouraged capital deficient banks that will be unable to meet the 60 million cedis capital recapitalisation requirement by the end of next year to list on the Ghana Stock Exchange.

This will allow them to operate for some time without necessarily recapitalizing to the tune of 60 million cedis.

Diana Layfield however indicated that one of the challenges in such acquisition moves is the selling price of the targeted banks to acquired as some analyst have also indicated some of the banks are over-priced.

STANCHART Plc is also cautious about the timing of the acquisitions as according to the CEO, has to be right and the opportunity has to be right as well.

"We absolutely would not rule out acquisitions in Africa. We always look at opportunities available in our footprint.

The challenge for us is the price has to be right and the timing has to be right and the opportunity has to be right," Layfield said at the bank's Johannesburg's offices.

"Typically things in Africa have not managed to stack up along those criteria."

Standard Chartered Plc makes about 10 percent of its profit in Africa and has indicated it would do more project and trade finance deals in Africa in subsequent years.

Layfield, a graduate of Oxford and Harvard and a former McKinsey consultant, said Nigeria -- Africa's most populous nation -- and Ghana will be key growth areas, given their vast oil resources and burgeoning small businesses.

"The challenge for us in turbulent economic times is taking what will inevitably be a limited investment budget and focusing it in the right place."

"Nigeria and Ghana in particular will be critical growth engines for the future," she said. "Those are areas we absolutely can't afford to neglect."

Standard Chartered has more than 7,000 African staff in 16 countries, mainly in sub-Saharan markets where it has a long-standing wholesale and retailing banking presence.

While Standard Chartered ranks 11th this year in investment banking fees from Africa, well behind top-ranked Morgan Stanley and second-ranked Rand Merchant Bank, the bank is a major player in project finance.