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Zenith Bank Plc has reportedly been given the green light to merge or acquire Union Bank Nigeria Plc. Nairametrics got wind of this from a reliable source. We understand talks are currently ongoing between the banks and a tentative arrangement may have been reached to commence due diligence.

Just last week reports from the Daily Independent suggest Nigeria’s oldest bank FirstBank was also on track to merge or acquire Polaris and Heritage Banks respectively. The bank issued a press release on the Nigerian stock exchange that did not deny the claims but also did not confirm if it is true.

Zenith Bank is Nigeria’s largest bank by profits and second by total assets and could increase its size significantly further with a potential acquisition or merger of this magnitude.

Sources from both banks denied any merger plans have been concluded but will not deny or affirm if talks are ongoing. Our sources also inform Nairametrics that some executives of both banks are not favourably disposed to a merger while others are. Any merger between the banks will surely require the blessing of Jim Ovia, the Chairman and Founder of Zenith Bank, and we now also understand no decision has been made. One of our other sources also claims that he denied any such deal. 

We did not expect an affirmation of a deal at this stage. Nairametrics also got a similar response when we contacted sources in First Bank for the reported merger with Polaris Bank and Heritage Bank. In 2018 Access Bank and Diamond Bank also denied any merger plans when we reached out to them when the initial merger news broke. Both banks eventually announced a deal and consummated a merger in December 2018.  Deals like these are typically not confirmed until a clearance is obtained from the Securities and Exchange Commission.

Why the merger: It is not immediately clear why both banks will be considering a merger, however, Union Bank owners Atlas Mara with a 49% stake has been under pressure to exit their African holdings. Last year (February), Atlas Mara co-founder Bob Diamond announced he was resigning his post as Chairman of the company. The company said it was looking at selling off banking assets in countries where it was not the dominant player.

READ MORE: CBN says Nigerian banks’ assets and liabilities are now at N41.42 trillion

Earlier in January, Union Bank sold its United Kingdom subsidiary to MBU Capital Limited. The London-based management investment firm acquired Union Bank UK after emerging as the most preferred bidder. According to the bank, “This sale is aligned with Union Bank’s strategy to geographically streamline its business operations to focus on growth opportunities in Nigeria.”

Union Bank also recently raised N20 billion in series 3&4 commercial paper after successfully raising N24.3 billion through the issuance of the Series 1 and 2 of its N100 billion commercial paper programme.

Deal book 300 x 250

Why Zenith: We believe for Zenith Bank a potential merger could be for two main reasons. Firstly, a merger firmly solidifies Zenith Bank’s position as the largest bank by total assets after falling second to Access Bank with N7.1 trillion. It also gives Zenith Bank control over several juicy assets and right of ways owned by Union Bank from its legacy years.

READ ALSO: Women entrepreneurs set to benefit $200 million from Union Bank 


It could also have been instigated by the CBN which cannot phantom another nationalization of a bank the size of Union Bank. Sources inform Nairametrics that the apex bank is favourably disposed to this move.

Result sheet: Union Bank Results; In a notification that was sent to the Nigerian Stock Exchange (NSE), the banking group recorded a 10.3% growth in profit. The profit before tax as of December 31, 2019, was N20.35 billion as against the N18.45 billion that was achieved for the corresponding period for 2018.

Zenith Bank, on the other hand, reported a record profit after tax N208 billion out of a gross earning of N662 billion. Zenith Bank’s net assets of N941.8 billion dwarfs Union Bank’s net assets of N252 billion as of 2019.

Union Bank share price closed at N6 with a market cap of N174 billion as on Friday, March 13th. Zenith Bank closed at N11.90 or N373 billion and trading at a price to earnings multiple of 1.79 compared to Union Bank’s 7.28x.

Note: This story was updated with new information in paragraph 4 and 5.




  1. I don’t like this at all. I was praying for a merger between union bank and fidelity bank to be named union fidelity bank. The combined bank would have automatically became a tier one bank in nigeria.


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