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Report: Nigerian banks affected as Congo’s central bank compels lenders to sell 45% stake

Report: Nigerian banks affected as Congo’s central bank compels lenders to sell 45% stake Report: Nigerian banks affected as Congo’s central bank compels lenders to sell 45% stake

Banks in the Democratic Republic of the Congo (DRC) have concerns that they might have to sell up to 45 percent of their stakes within three years due to a directive from the central bank of the country.

According to a Bloomberg report, an order, known as instruction 18, mandates that each of Congo’s banks has at least four unrelated shareholders — including current owners — holding a minimum of 15 percent each in order to spread risk.

Six people with knowledge of the directive told the publication that most of Congo’s banks would have to sell a sizable portion of their equity by 2026.

The Congolese Banking Association, which represents the country’s 15 lenders, said its members were still reviewing the instruction “to ascertain the feasibility and implications of the proposed requirements”. 

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Recently, Kenya’s two biggest banks, Equity Group Holdings Plc and KCB Group Plc, bought stakes in three Congo lenders.

KCB and Equity declined to comment, while Standard Bank said it was “engaging with the central bank, bankers’ association and stakeholders with respect to this recent directive”.

While several of the bankers told Bloomberg they didn’t believe the central bank could enforce the directive, some are already taking steps to comply with the order.

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Seyi Kumapayi, Access Bank Plc executive director for African subsidiaries told the publication that it “is studying the new regulation with a view to ensure compliance far ahead of the effective date of the regulation”. 

FBN Holdings Plc also committed to complying with the regulations and said it was “exploring all our options.”

Citigroup Inc., which has a small unit in Congo, and Rawbank SA, the country’s largest lender, declined to comment.

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