The Competition Authority of Kenya (CAK) has formally cleared the path for Zenith Bank Plc to acquire 100% of Paramount Bank, marking a pivotal moment in the Nigerian lender’s long-anticipated entry into the East African market.
The decision removes a significant regulatory roadblock for the Lagos-based financial giant. However, this approval is anchored by a strict legal mandate requiring Zenith to retain all 78 of Paramount Bank’s current employees for a minimum of 12 months following the deal’s conclusion.
While the regulator determined that the takeover would not stifle competition, it emphasized that safeguarding local jobs remains a critical public-interest priority.
“The Authority has approved the proposed acquisition… on condition that the acquirer retains the target’s 78 employees for at least twelve months following completion” CAK noted.
This strategic move effectively concludes months of industry speculation regarding Zenith Bank’s expansion tactics in Kenya.
By choosing an acquisition over a greenfield start-up, the bank, which maintains dual listings in Lagos and London secures immediate access to a domestic banking license, an established workforce, and an existing client portfolio.
This maneuver aligns Zenith with other West African banking peers like Access Bank, UBA, and GTBank, all of whom have established a presence in Nairobi.
Notably, Access Bank recently set a valuation benchmark for such entries in 2025 when it paid $109.6 million to acquire the National Bank of Kenya.
The timing of this acquisition is particularly significant as smaller Kenyan lenders face immense pressure from aggressive new capital adequacy rules introduced in December 2024.
These reforms mandate a steep increase in minimum core capital, rising from KES 1 billion to KES 3 billion by December 2025, with a final target of KES 10 billion by 2029.
With 10 out of Kenya’s 39 licensed banks failing to meet the initial December 2025 threshold, a “buyer’s market” has emerged.
Tier III lenders like Paramount, which currently ranks 33rd in market share, are increasingly seeking well-capitalized foreign partners to ensure their long-term survival in a tightening regulatory environment.
Because Zenith Bank currently has no existing operations within Kenya, the CAK concluded that the transaction would not materially alter the competitive landscape, as established rivals will continue to control the vast majority of the market.
The authority’s official decision explicitly stated that the approval was conditional upon the protection of the target’s 78 staff members.
Despite this green light from the competition watchdog, the deal still awaits final authorization from the Central Bank of Kenya and relevant regulatory bodies in Nigeria.
Should these final hurdles be cleared, Zenith Bank, with its $2.03 billion market capitalization, is poised to become a powerful new force in Kenya’s evolving financial sector.