NAIROBI, Kenya — In a bold potential move reshaping Kenya’s banking landscape, Standard Bank’s Kenyan subsidiary is reported to be in advanced talks to acquire NCBA Group, the bank tied to the Kenyatta family.
The development comes at a sensitive moment: NCBA is simultaneously grappling with a recent court ruling that struck down a major tax exemption granted during its formation.
If completed, the acquisition would create one of East Africa’s largest financial institutions, with assets nearing Sh1.1 trillion, positioning the merged entity just behind local giants Equity Group and KCB Group.
According to sources close to the matter, Stanbic Holdings (Standard Bank’s local arm) and NCBA have reportedly secured internal approvals to proceed with negotiations. The transaction would bring together Standard Bank’s continental strengths and NCBA’s entrenched local operations.
The valuation proposed is around KSh 114 billion (approximately US$880 million), based on NCBA’s current stock market metrics.
NCBA itself originated from the 2019 merger of NIC Bank and Commercial Bank of Africa (CBA), the latter of which has historical links with the Kenyatta family.
Analysts caution that the deal would not only alter market dynamics but also face intense regulatory scrutiny — especially given NCBA’s pending legal troubles over the tax exemption.
In April 2025, the High Court nullified a KSh 384.5 million stamp duty exemption that had been granted to NCBA under Legal Notice No. 112 (2019) during the merger of NIC and CBA. Justice Chacha Mwita found the exemption unconstitutional, determining it did not satisfy the required public interest test.
The ruling effectively bars NCBA from relying on the waiver, which was estimated to cover over KSh 7 billion in tax obligations.
The judge’s decision cited procedural lapses in exercising discretion under Section 106 of the Stamp Duty Act and criticized the Treasury for failing to meet constitutional principles of transparency, accountability, and public participation.
NCBA has responded by announcing plans to appeal the decision, maintaining that the waiver was legally obtained and served broader financial goals.
In parallel, the National Treasury, citing fallout from the NCBA case, has proposed removing stamp duty exemptions altogether in the upcoming 2025 Finance Bill.
The timing of Standard Bank’s acquisition interest is significant: NCBA is entering the talks not from a position of strength, but with a major legal cloud looming over its finances. An acquisition under such circumstances would require careful risk assessment by Standard Bank and regulators alike.
- Financial liability risk: If the exemption decision is upheld and enforced, NCBA may face retroactive tax claims — exposure that could subtract from its apparent valuation.
- Regulatory scrutiny: A proposed merger of this scale would likely prompt deep examination of governance, capital adequacy, tax compliance, and concentration risks by banking regulators and competition authorities.
- Reputational dynamics: NCBA’s link to the Kenyatta family and the controversial nature of the exemption will heighten public attention and political interest.
- Leverage in negotiations: Standard Bank potentially gains bargaining power given NCBA’s legal and financial uncertainty, which may affect pricing or terms.
If Standard Bank proceeds, it will be entering not just a banking deal, but one entwined with judicial, fiscal, and political dimensions.
What to Watch Next
- Regulatory approval — The Central Bank of Kenya, Capital Markets Authority, and other oversight agencies will vet any proposed transaction, especially in light of NCBA’s legal issues.
- Appeal outcome — The decision by the Court of Appeal on the tax exemption case could swing the balance, either easing or intensifying NCBA’s burden.
- Due diligence disclosures — Standard Bank will need full visibility into NCBA’s contingent liabilities and litigation risks to structure a fair offer.
- Shareholder sentiment — NCBA shareholders (including the significant Kenyatta family stake) will closely assess whether the acquisition premium appropriately factors in legal risks.
The convergence of Standard Bank’s acquisition ambition and NCBA’s tax liability battle creates a high-stakes moment for both institutions. The interplay between legal judgments and corporate strategy now holds the potential to redefine Kenya’s banking landscape — or unravel a deal before it begins.
