The Cabinet Secretary for the National Treasury and Planning has approved the acquisition of 38.91 per cent of the issued share capital of Sidian Bank by Pioneer General Insurance,Wizpro Enterprise and Afram Limited.

The shareholders of the bank vide a resolution passed on 20 September this year, approved the acquisition of 38.91 per cent of the issued share capital of Sidian by Pioneer, Wizpro and Afram at 20, 15 and 3.91 per cent shareholding respectively, as per the Share Purchase Agreement dated 13^th September, 2023.

In a Gazette notice published on Friday, Central Bank of Kenya Governor Kamau Thugge said the acquisition shall take effect on the 20^th October, this year.

The alliance with the new shareholders is expected to create a significant synergy between the insurance sector and the banking sector in Kenya, ultimately bolstering the bank’s ability to provide tailor-made financial solutions for SMEs and other clients.

Early this year, Centum Investment, a majority shareholder in Sidian Bank called off sale of stake to Nigeria’s Access Bank.

Had the 4.3 billion shilling ($35 million) transaction proceeded, it would have been the second acquisition in Kenya for Access Bank, which acquired Transnational Bank, now called Access Bank Kenya, in 2020.

Sidian Bank, a pro Small and Medium Enterprises Bank last week renewed a guarantee programme with the African Guarantee Fund (AGF) at a tune of Sh1.5 billion, tripple what AGF offered in the first phase of the programme.

The enhancement of the portfolio guarantee limit is set to empower the bank to provide enhanced support to the Kenyan SME sector over a period of 7 years, commencing in 2023. The most prevalent challenges faced by SMEs is the lack of sufficient collateral to secure loans. AGF’s risk-sharing guarantee facility will enable Sidian Bank to scale up its lending activities to SMEs, ensuring that these businesses have access to the credit facilities they need to thrive.

Sidian Bank said between 30 per cent to 50 per cent of the facility will go to women led businesses, majority of which are in the informal sector but play a significant role in Kenya’s economy.