Nigeria's Zenith Bank denies moves to acquire Union Bank Plc

Zenith Bank Plc has denied news reports over plans to acquire one of the country's banks.

Last week, Nairametrics reported ongoing talks between Zenith Bank Plc and Union Bank of Nigeria Plc over merger and acquisition deal.

“Zenith Bank Plc has reportedly been given the green light to merge or acquire Union Bank Nigeria Plc,” the report quoted industry sources.

Jim Ovia, Founder and Chairman of Zenith Bank Plc

But in a reaction posted on the Nigerian Stock Exchange on Tuesday, March 17th, 2020, Michael Osilama Otu, Zenith Bank secretary, dismissed the report.

“We hereby state categorically that Zenith Bank Plc has not made any binding offer to acquire any financial institution.”

Why merger and acquisition deal popping up in Nigeria’s banking industry

In 2019, Godwin Emefiele, the CBN governor, talked about a fresh hinted recapitalization plan in the banking industry.

Union Bank of Nigeria building

He had said the new capital will help lenders to meet customers’ credit needs and contribute to economic growth in the wake of seven commercial banks failing regulator’s stress test in funding.

Last week, industry sources also told Business Insider SSA that First Bank Plc is considering merger and acquisition plans with Heritage Bank and Polaris Bank, formerly Skye Bank.

First Bank of Nigeria reacted, saying it will "only consider inorganic growth when it is value accretive to shareholders and other key stakeholders."

On Monday, Zenith Bank Plc approved a final dividend of N2.50 per share, bringing the total dividend payment for the 2019 financial year to N2.80 per share with a total value of N87.9 billion.

The shareholders gave their nods to the final dividend payout at the bank’s 29th Annual General Meeting in Abuja, the nation’s capital.