Diamond Bank’s Chief Executive Officer Uzoma Dozie has officially announced that the bank’s board had selected Access Bank as the preferred bidder for a potential merger.
Aside that the name Diamond Bank will no longer exist, the deal will expectedly come at a heavy cost to the Diamond Bank management team, especially on job security. The management team is likely to be disbanded.
“You cannot have two managing directors of a bank, domestic and foreign operations and even chief financial officers in one bank. One has to give way and the Diamond Bank staff will be the casualties. The Diamond Bank management team should know that their jobs are gone,” former General Manager Richard Obire said.
According to him, Access Bank is a very ambitious lender and that is one of the characteristics of its management team.
“They want to be big, and perhaps, the biggest bank in Nigeria and that was presented to them on a platter of gold by the Diamond Bank opportunity. Diamond Bank is now a small bank compared to its peers. It is now a tier-3 bank. I do not know the terms of the transaction but they will lose their brand name.
“It is the reality of business. Diamond Bank has such a brilliant brand name and customer base and these are what Access Bank will inherit. The name Diamond Bank is gone forever and the next will be integration, which will lead to exit of the bank’s management team.”
Access Bank’s decision to acquire Diamond followed a presentation made to it last week by its financial advisers in London, which showed huge strengths inherent in Diamond Bank.
The board of Diamond Bank Plc yesterday finally announced its merger with Access Bank Plc.
As was previously reported but which was vehemently denied by Diamond Bank, “It was gathered that both financial institutions have reached an agreement in broad terms on the acquisition. What is left is the valuation of assets, with a view to determining the level of compensation and systems’ integration, the sources said, pleading not to be named because they are not allowed to talk to the media on the matter.
“It was learnt that the development leading to the impending acquisition was triggered by Diamond Bank directors who approached Access Bank for intervention in a bid to stave off a possible regulatory intervention that could lead to the withdrawal of the lender’s operating licence in the light of the bank’s depleting capital adequacy ratio on account of a huge Non Performing Loans (NPLs) portfolio put at over N150 billion.”
Dozie said the potential merger of the two banks would create Nigeria and Africa’s largest retail bank by customers, adding that the transaction to be completed in the first half of 2019 was in the best interest of all stakeholders.