The Access Bank Diamond Bank merger is on track. The newly merged bank aims to kick off for business on 1 April.

The Central Bank of Nigeria and the country’s Securities and Exchange Commission have approved the Access Bank Diamond Bank merger.

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The parties describe the transaction as a merger but effectively Access Bank is buying its mid-tier rival.

Diamond is suffering challenges with non-performing loans and profitability.

Nigerian banks are raising fresh capital after major loan losses, exacerbated by the economy falling into recession last year.

Access Bank Diamond Bank merger: 677 branch strong network

Access Bank has a network of around 400 branches. Troubled rival Diamond operates 277 branches.

A combination of Access and Diamond will form a bank of around 29 million customers served by 677 branches.

The Access Bank Diamond Bank merger forms Nigeria’s largest bank by customer numbers with a significant position in digital.

Access has around 6.4 million digitally active customers. Since launching in 1990, Diamond has been among the most active local banks to promote financial inclusion.

Access Bank Diamond Bank merger: benefits

According to the two banks, Diamond Bank wILL benefit from Access Bank’s risk and capital management expertise. At the same time, Access Bank will take advantage of Diamond Bank’s retail banking market strength.

Retail banks in Nigeria are under pressure from the central bank to boost financial inclusion. Only around 37 million of Nigeria’s 97 million adults are banked.

In 2012, The Central Bank of Nigeria launched its National Financial Inclusion Strategy (NFIS). Specifically it set a target of a financial inclusion rate of 80% for Nigeria’s adult population by 2020.

Diamond is growing its market share by offering financial services to 10 million previously unbanked individuals.

Last year Diamond also partnered with Facebook in a project to encourage young Nigerian entrepreneurs.

As a result of its digital drive, Diamond Bank now has around 7 million digitally active customers.

Access Bank 2018 results

For the 12 months to end December 2018 Access Bank net profit rises by 58% to NGN95bn ($197.5m).

Total assets are up by 20% to NGN4.95trn.

Nigeria: largest banks by branches

  • First Bank Nigeria 750
  • Access Bank & Diamond Bank 677
  • Ecobank 610
  • United Bank for Africa 600
  • Access Bank 400
  • Polaris Bank 373
  • Zenith Bank 365
  • Union Bank 300 (sales and service centres)
  • Diamond Bank 277
  • Fidelity Bank 240
  • Guaranty Trust Bank 231
  • Unity Bank 217
  • FCMB 204
  • Heritage Bank 197
  • Sterling Bank 183
  • Stanbic IBTC 180
  • Wema Bank 151
  • Standard Chartered Nigeria 35