Finance Bank Sold To FirstRand Of South Africa

JOHANNESBURG (Reuters) – South Africa’s FirstRand has agreed to pay $5.4 million for Zambia’s Finance Bank, the central bank said on Monday, giving South Africa’s second-largest lender a big boost in the continent’s top copper producer.
The central bank seized Finance Bank from its shareholders in 2010 for for violating the law through unsound practices, including insider borrowing.
“Upon agreeing appropriate terms, (the Bank of Zambia) accepted the offer by FirstRand,” the central bank said in a statement.
FirstRand will operate all 34 branches and 16 agencies of Finance Bank, while the Bank of Zambia would continue to run its problematic assets, such as those which were currently under litigation, the central bank said.
Finance Bank has the largest rural network among Zambian commercial lenders.
The central bank said it accepted FirstRand’s offer because of its superior profile and track record in managing weak banking institutions.
FirstRand already has operations in seven African countries outside of South Africa, including Zambia.
The lender is scheduled to report its full-year earnings on Tuesday. Some analysts expect that it would be returning excess capital to shareholders after selling off a stake in an insurance unit for 3.75 billion rand earlier this year.
FirstRand shares are up 0.49 percent at 20.60 rand at 1426GMT.

Posted by Admin on September 12, 2011. Filed under BUSINESS. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

7 Responses to Finance Bank Sold To FirstRand Of South Africa

Enoch Reply

September 12, 2011 at 8:57 pm

This really is a sad state of affairs.mr mathani worked extremely hard to put finance bank were it is today and we have individuals comin frm nowhere and grabin the instititution frm shareholders when only 1 mathani alegedly flouted the bankin and financial services act.why was’nt mathani singled out and prosecuted like is the case?were’nt there anyother alternative measures available other than grabing the institution frm the shareholders?these are legitimate questions dat need legitimate responses especially frm fundanga.
AGGRIPA Reply

September 13, 2011 at 3:48 am

$5.4 million dollars is just too small.
The amount is a give away price.
anti-RB Reply

September 13, 2011 at 6:40 am

rupiah banda and hiz vultures vgot bad maners.ba mambala r busy auctioning zambia.
CHINVINDINVINDI Reply

September 13, 2011 at 7:03 am

It had to be done BEFORE ELECTIONS. it smacks of an illegal undertaking.
Is this a Party to trust again with power? Countrymen, we have to stop this settling of old personal matters.
Martin Reply

September 13, 2011 at 2:49 pm

Thats a step ahead, The Bank has had problems for some time now. Cheers to the FirstRand of S.A. I just hope it will not start retrenching our already impoverished Finance bank employees who have been subjected to poorly low salaries as compared to other financial institutions.Forward tata fwebene!!!
Bernard Reply

September 15, 2011 at 11:42 am

It is a move that involves a lot of professionals, these guys assessed the asserts and what the bank owes its creditors then came to a conclusion about in what range the bank should be sold. Pretty sure there is brand equity that will be shared amongst the shareholders.
Mwenya Shereen Reply

September 21, 2011 at 10:34 am

And they want to continue in Government..for what?