Somalia's Premier Bank acquires majority shares in First Community Bank

First Community Bank seen along Kimathi street, Nairobi. [Elvis Ogina, Standard]

Premier Bank Limited, Somalia (PBLS) has acquired 62.5 per cent shares of First Community Bank Limited (FCB), following approval by the Central Bank of Kenya.

In a statement on Friday, March 17, CBK announced the acquisition under section 13(4) of the Banking Act and approval by the Cabinet Secretary for the National Treasury.

"CBK welcomes this transaction that will diversify and strengthen the resilience of the Kenyan banking sector. The acquisition will strengthen the trade and investment ties between Kenya and Somalia," CBK noted.

Trouble at First Community Bank became public last year when it faced a bank run, triggered by what it termed a 'system hitch.' Customers lined up in numbers to make withdrawals out of fear that FCB would become bankrupt.

First Community Bank was a CBK-licensed institution to conduct sharia-compliant banking business, as of April 2008. The bank with at least eighteen (18) branches across the country existed in the market for about 15 years.

"It is categorized as a small bank with a market share of 0.3 percent as of December 31, 2022."

Whilst its newest and largest shareholder, PBLS was licensed in 2014 by the Central Bank of Somalia.

According to CBK, Premier Bank is a privately-owned Shariah-compliant commercial bank with twenty (20) branches.

It offers retail banking services, and also caters to small and medium-sized enterprises (SMEs) and corporates.