The Competition Authority of Kenya (CAK) has approved the proposed acquisition of 100% of Paramount Bank Limited by Zenith Bank PLC, subject to conditions intended to protect employment.
In a notice on January 22, CAK stated that it determined that the deal is unlikely to substantially reduce competition in Kenya’s banking sector, while potential negative impacts on jobs can be addressed through mitigating measures.
“The Competition Authority of Kenya has approved the proposed acquisition of 100% shareholding of Paramount Bank Limited by Zenith Bank PLC, subject to conditions aimed at safeguarding employment,” read part of the statement.
CAK also stated that Zenith’s proposed acquisition of Paramount Bank met the threshold for mandatory notification and a full review under the Competition Act.
The acquisition follows Zenith Bank PLC’s formal clarification on November 19, 2025, dismissing media reports of an ongoing takeover of Paramount Bank in Kenya.
Zenith Bank Wins Approval for Paramount Takeover
CAK detailed the market assessment framework it used during its review of Zenith Bank’s proposed acquisition of Paramount Bank.
After analysis, it identified the relevant product and geographic markets to determine the merger’s impact on competition.
Relevant product market covered banking services that consumers could interchange, or substitute based on characteristics, pricing, and intended use.
The banking sector, regulated by the Central Bank of Kenya (CBK), was classified by CAK into three tiers based on net assets, deposits, capital, reserves, and the number of customer accounts.
Competitiveness and substitutability in the sector were influenced by:
- Branch networks: Physical branch numbers indicated market presence, though digital channels such as mobile, internet, and agency banking were increasingly replacing brick-and-mortar operations.
- Banking agents: Over 90% of approved agents were concentrated in Equity Bank (40,211), KCB Bank Kenya Limited (24,055), and Cooperative Bank of Kenya Limited (15,519).
- Automated Teller Machines (ATMs): ATM numbers declined in recent years due to growing mobile and digital banking adoption.
As of December 2024, Kenya had 39 licensed banks: 9 Tier I, 9 Tier II, and 21 Tier III banks. Paramount Bank was classified as a Tier III bank, ranking 33rd out of 39.
Also Read: Nigeria’s Zenith Bank Clarifies Reports of Acquiring Kenyan Bank
CAK Conclusion And Review
CAK determined that the transaction was unlikely to substantially lessen or prevent competition in Kenya’s banking sector.
Post-merger, Paramount Bank’s market share is expected to remain unchanged, as Zenith did not have similar commercial operations in Kenya.
The merged entity would still face competition from other banks controlling over 99.8% of the market.
During its review, CAK also considered public interest concerns, which under the Competition Act include the impact on employment, competitiveness of SMEs, specific industries or sectors, and the ability of national industries to compete internationally.
According to the parties’ submissions, the transaction was not expected to negatively affect public interest, as all of Paramount Bank’s employees were to be retained under their current terms.
Based on these findings, the Authority approved the acquisition on the condition that Zenith Bank retains Paramount Bank’s 78 employees for at least 12 months following completion of the transaction.
Also Read: South African Giant Places Proposal to Take Over Kenya’s NCBA Bank
About Zenith Bank
Zenith Bank, incorporated in Kenya with a parent company listed on the Nigerian and London stock exchanges, currently has no operations in Kenya.
It offers corporate and retail banking, wealth management, investment banking, trade finance, treasury, and related financial services across Nigeria, Ghana, Sierra Leone, Gambia, the UK, France, the UAE, and China.
Paramount Bank, the target of the acquisition, is incorporated in Kenya and provides banking services. It also controls Paramount Bancassurance Intermediary Limited and PB Capital Limited, its investment banking subsidiary.
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