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…Will Recapitalise Unit With $24.7m
In a curious state of play regarding South Africa’s ease of doing business, Nigerian owned Access Bank has been forced to sell a 25.45% stake of its South Africa subsidiary to black individuals to comply with Black Empowerment (BEE) laws.
The Bank recognized the difference between the Sales proceed (N8.3 billion) and the carrying amount of the portion of investment disposed (N9.7 billion) as a loss (N1.5 billion) in statement of comprehensive income for the period.
On 30 May 2025, Access Bank Plc completed the sale of 25% (1,083,261,865) shares and an additional share of 1 of its ordinary shares in Access Bank South Africa to a consortium of Broad-Based Black Economic Empowerment (“B-BBEE”) purchasers, who are unrelated third parties.
Access sold its South African unit stake down from 97.89% to 72.35%.
The transaction was undertaken to comply with the South African Broad-Based Black Economic Empowerment (B-BBEE) legislation, which promotes the inclusion of B-BBEE eligible citizens within the South African economy.
In the separate financial statements, the Bank continues to carry the remaining investment in subsidiary at cost.
The transaction was agreed at a total consideration of ₦10.3 billion (equivalent to ZAR 116.1 million), which is receivable after three years from the transaction date.
The fair value was determined by discounting the expected future receivable using a 7.25% discount rate, corresponding to the South African Reserve Bank’s monetary policy rate at the disposal date.
The difference between the nominal consideration and the fair value represents the impact of the time value of money and will be unwound to profit or loss over the three-year period using the effective interest method.
As of June 2024 Access Bank had already injected capital of Zar1.4bln (N115 billion), since its acquisition of Access Bank South Africa in 2021, while persistent losses have continued for the subsidiary.
Access Bank South Africa made a loss of N9.3 billion in the Half Year 2025 period.
Meanwhile, Access Holdings is investing USD24.7 million in Access Bank South Africa as deposits for shares for the recapitalization of the bank. following the approval of the Central Bank of Nigeria.
Access Holdings had on its books a subscription for investment relating to the transaction of N34.62 billion.
Basically Access Bank is taking risks and investing money taken from Nigeria while handing over shares on a platter to black South Africans, despite the owners of Access Bank being blacks themselves.
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