On the closing of the Proposed Transaction, African Bank announced that it was the successful bidder to acquire the majority of Ubank’s disclosed assets and liabilities, as well as take on its employees on a going concern basis.
Ubank is a well-known financial services provider with a strong presence in a number of mining and rural communities. Despite being placed under curatorship on May 16, 2022, Ubank has continued to operate in the ordinary course of business. African Bank will not acquire the legal entity of Ubank, and any residual assets and liabilities will be retained by its legal entity.
The proposed transaction is consistent with African Bank’s Excelerate25 strategy of developing a scalable, diverse, and sustainable banking business with a compelling listable proposition, as well as its founding philosophy of being “a bank for the people, by the people, and serving the people.”
“Ubank’s strong retail deposits, transactional accounts, and partnership with MTN’s Mobile Money will accelerate African Bank’s diversification and scaling, in line with our mission to build a customer-centric, digital, and data-enabled business that is diversified, scalable, and sustainable,” says Kennedy Bungane, CEO of African Bank.
Ubank’s mining sector market position and distribution footprint complement African Bank’s existing national offering, and Ubank’s customers will have immediate access to African Bank’s nationwide distribution footprint. Customers of Ubank will be transferred to African Bank’s MyWORLD product, which provides more personalization, lower fees, and a more competitive value.
African Bank’s net profit after tax increased 145% to R372 million in its most recent half-year results. African Bank purchased 100% of Grindrod Bank in May of this year for R1.5 billion, giving African Bank an existing corporate and SME client base.