…Likely to finalise FNB/Pointbreak merger this year
The Namibian Competition Commission(NaCC) last year determined a total of 38 mergers that were notified to it-of which only 2 were approved with conditions and the rest receiving unconditional approvals.
This is 10 less than the 48 mergers determined in 2015. Of the 48 mergers determined during the 2015/2016 financial year, 47 were unconditionally approved and only one merger determined in the first quarter was approved subject to conditions.
This was revealed by NaCC’s Economist for Mergers and Acquisitions Katando Kangueehi in response posed by this publication recently.
Asked whether the Commission is satisfied with the level of competition in the Namibian market and how the level of competition advantaged or disadvantaged consumers in Namibia over the years, he said there are still some legacy issues hampering competition but urged consumuers to report untoward competition practices.
“The mandate of the Commission is to promote and safeguard competition in the Namibian economy. Important to note is the history of the country where the economy was highly concentrated and a vast section of the Namibian people excluded from the mainstream of the economy. In that regard there are legacy issues that hampers competition and which must be addressed,” Kangueehi said.
He further added: “Generally speaking competition is advantageous for consumers as it reduces prices, fosters innovation and broadens goods and services that consumers could consume. From that perspective, competition is advantageous for consumes in general.”
The Commission urged consumers of goods and services to approach the Commission and report mergers implemented in contravention of the Competition Act and/or report any conduct that could be potentially anti-competitive. “Anyone can approach the Commission and provide information on a confidential basis.”
FNB Namibia’s is currently in the process of acquiring 100% of Pointbreak and EBank, subject to all necessary regulatory approvals and Bank of Namibia, Namfisa, Namibian Competition Commission (NaCC) and the South African Reserve Bank are the institutions that have been listed as the institutions that must approve or disapprove the planned takeover. Kangueehi said a determination on this merger is likely to be made this year.
Kangueehi said the Commission received the merger notice in terms of the Competition Act. “The Commission is investigating the merger and part of the investigation entails engaging with relevant stakeholders such as customers, competitors, suppliers, etc.”
The Patriot understands that several players in the local banking and finance industry has written to NaCC opposing the pending merger.
Some of the local commercial banks, names withheld, are said to have written submissions to NaCC opposing the planned merger as they feel it will create an unleveled playing field.
“The Commission did engage with stakeholders and have received submissions from interested stakeholders regarding the proposed merger. The Commission cannot disclose information provided to it by stakeholders as the investigation is ongoing,” he said.
According to Kangueehi, the Commission will evaluate the submissions from the merging parties and other information that the Commission will gather during its investigation and makes a determination in terms of the relevant provisions of the Competition Act a determination will be made once the Commission has concluded its investigation.
“The Commission welcomes and urges interested stakeholders to make submission pertaining to competition and public interest considerations likely to emanate from the implementation of the proposed merger.”
In an interview with this publication last year, FNB’s Chief Marketing Officer Tracy Eagles said “we have no knowledge of ‘crowding out’ talks”.
“The acquisition is a natural expansion of value to customers at both ends of the value offering, enabling a great idea such as EBank to expand its footprint, and grow with stronger support to better meet its market’s needs, and enabling the development of investment expertise within the bank to better service the biggest wealth market potential we already hold as clients, while at the same time ensuring global access, alongside local expertise value to existing customers specifically. This move is about customer value addition, about what’s best for customers,” she told The Patriot at the time. If approved, the merger could see over N$8 billion being moved into the hands of the country’s largest commercial bank.
Talks of potential conflict of interest in the deal involving FNB’s planned acquisition of Pointbreak and EBank are rife, seeing that the FNB board Chair Inge Zamwaani-Kamwi also serves as an advisor to President Hage Geingob who is married to Monica Geingos. She is an executive board member of Pointbreak and the Chairperson of EBank. Geingob dispelled any talks of conflict of interest saying Zamwaani-Kamwi declared her interests and permission was given for her to serve as FNB chair.
FNB dismissed claims of conflict of interest saying all measures were put in place to ensure that transparency.
It is expected that the acquisition of Pointbreak, which is managing in excess of N$8 billion of third party capital, will enhance the investment know-how and local wealth management capability of FNB.
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