NAIROBI, Kenya – The Competition Authority of Kenya (CAK) has approved the proposed acquisition of 100% shareholding in Paramount Bank Limited by Zenith Bank PLC, but has imposed conditions to protect employment in the Kenyan banking sector.
In its decision released on 22 January 2026, CAK said the transaction is unlikely to significantly reduce competition in the banking sector, but raised concerns over possible negative effects on jobs.
These concerns, the authority said, can be addressed through mitigating remedies.
Zenith Bank PLC, incorporated in Kenya but without operations in the country, is part of a larger group listed on the Nigerian and London stock exchanges.
The bank operates across several countries including Nigeria, Ghana, Sierra Leone, the United Kingdom, France, the UAE, and China, offering services such as corporate and retail banking, wealth management, investment banking, trade finance, and treasury.
Paramount Bank Limited, the target firm, is also incorporated in Kenya and operates nationwide.
It controls Paramount Bancassurance Intermediary Limited, an insurance intermediary, and PB Capital Limited, its investment banking subsidiary.
Why the deal was approved
CAK said the merger does not pose a significant threat to competition in the market for banking services in Kenya. It concluded that the acquisition will not substantially prevent or lessen competition.
The authority noted that the transaction was primarily aimed at strengthening Paramount Bank’s financial position and ensuring compliance with enhanced core capital requirements.
It also aims to reduce reliance on “ad-hoc” shareholder capital support.
Why the transaction required CAK approval
Under the Competition Act CAP 504, mergers and acquisitions that exceed a threshold of Sh1 billion in combined turnover or assets must receive CAK approval before implementation.
Zenith’s acquisition of Paramount met this requirement, triggering a full merger analysis.
During the review, CAK defined the relevant product market as banking services, which it said are interchangeable based on pricing, consumer needs, and service characteristics.
The geographic market was identified as national, since Paramount Bank offers services across Kenya.
Banking sector competition factors
CAK highlighted several factors that influence competition in Kenya’s banking sector, including:
- Branch networks, although digital channels like mobile banking and agency banking are increasingly replacing physical branches.
- Banking agents, noting that over 90% of agents are concentrated among three banks: Equity Bank, KCB, and Cooperative Bank.
- ATM infrastructure, which has been declining due to the rise of mobile and digital banking.
As of December 2024, Kenya had 39 licensed banks, classified into three tiers by CAK. Paramount Bank is ranked 33rd and classified as a Tier III bank.
 has approved Zenith Bank’s acquisition of Paramount Bank, subject to conditions aimed at protecting employment and ensuring market competitiveness.){kind=link}