Influential Ismaili leader Prince Karim Aga Khan is moving to consolidate two local banks that his companies control. Central Bank of Kenya (CBK) yesterday announced that Diamond Trust Bank (DTB) would acquire Habib Bank Ltd (HBL) in a deal that would be concluded by June. CBK said the transaction would be subject to approval locally and in Karachi, Pakistan where HBL moved its headquarters six years after it was established in Mumbai, India. "The transaction is expected to be completed by July 2017. CBK will provide further updates as the transaction progresses," said CBK in a statement. SEE ALSO: Kenyan bank taps anti money laundering expert to board The Aga Khan Fund for Economic Development owns 17 per cent stake in DTB and 51 per cent stake in HBL, according to filings in December 2015. HBL also owns a 12 per cent stake in DTB while Jubilee Holdings has cross-cutting ownership in the two banks. The move comes ahead of CBK's April deadline for banks to present comprehensive reports of their revised business models, setting in motion a risk-based approach to banking regulation. The approach is in line with the revised Internal Capital Adequacy Assessment Process (ICAAP) issued in November last year, and points at consolidation by the Aga Khan to have a stronger balance sheet. For More of This and Other Stories, Grab Your Copy of the Standard Newspaper. Read Now » Habib Bank made Sh298 million as at December 2015 while DTB made Sh6.5 billion in profit after tax during a similar period. DTB ranked sixth out of 41 banks with a market share of 6.1 per cent as at December 31, 2016 and a network of 61 branches around the country while HBL was ranked 33rd with a market share of 0.34 per cent and a network of six branches. SEE ALSO: How bank CEOs bought freedom in NYS scandal Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.
Diamond Trust Bank leader Prince Karim Aga Khan is consolidating banks under his corporate control, as East Africa's Ismaili acquires Switzerland-based Habib Bank. The deal is due to be completed by July 2017. The Aga Khan Fund for Economic Development owns a 17% stake in Ismaili, and a 51% stake in Habib Bank.