South Africa’s Nedbank promises to retain NCBA staff in Kenyan takeover

Nedbank Group, South Africa’s fourth-largest bank by assets, has committed to retaining all current NCBA employees after completing its proposed acquisition of the Kenyan lender, seeking to ease concerns that typically follow such large cross-border bank acquisitions in East Africa.

NCBA disclosed the assurances in a Monday notice of additional information, saying its staff would play a central role in Nedbank’s regional expansion strategy. The pledge was a key factor behind NCBA’s board recommending the transaction to shareholders.

The group’s pledge signals a departure from recent mergers and acquisitions, opting for an expansion play rather than a cost-cutting exercise, which has often come with painful job cuts.

“The offeror has confirmed that following completion of the proposed transaction, the existing contractual and statutory employment rights of NCBA management and employees will remain in full force,” the bank said. “NCBA management and employees will play an important role in the future development of the enlarged group.”

Eyes on East Africa

The commitment follows Nedbank’s January 21 announcement of a tender offer for a 66% stake in NCBA, a deal that would give the South African lender a substantial foothold in East Africa. While the initial offer documents were silent on staffing implications, NCBA chief executive John Gachora later said minimal disruption to the bank’s operations, brand, and workforce had been central to the board’s decision.

According to regulatory filings, NCBA employed 3,712 people at the end of December 2024, up from 3,462 a year earlier. Bank mergers and acquisitions in Kenya have historically been accompanied by branch closures, system consolidation, and job cuts as lenders seek efficiency gains.

The board structure under the deal also points to continuity. NCBA will retain its existing board structure, with Nedbank nominating at least two directors, while current NCBA shareholders will appoint one representative to Nedbank’s board.

Nedbank’s offer values NCBA at $7.6 billion, with shareholders able to tender up to 66% of their holdings on a prorated basis. 80% of the consideration will be settled through a share swap, with the remaining 20% paid in cash at KES 2,100 ($16.28) per 100 shares.