NCBA sets sights on DRC and Ethiopia as it weighs new banking acquisitions
NCBA Group is preparing to expand into the Democratic Republic of the Congo (DRC) and Ethiopia, with Managing Director John Gachora saying the bank is already looking for opportunities in both markets and expects acquisitions to provide its route into them.
Speaking at Bullish Africa, Gachora said NCBA sees itself in DRC and Ethiopia “in a very short time”, shortly after the completion of Nedbank’s acquisition of a controlling stake in the Kenyan banking group. The comments provide the clearest indication yet of what NCBA intends to do with its next phase of regional expansion.
The strategy also places NCBA in a wider African banking market where large institutions are pursuing different ways of building scale across borders. While some groups are looking to acquire established franchises, others are expanding existing businesses organically or considering greenfield operations where regulations and market conditions make acquisitions less practical.
NCBA turns to DRC and Ethiopia after Nedbank deal
NCBA already operates across Kenya, Uganda, Tanzania and Rwanda, giving it an established East African banking platform. The move into DRC and Ethiopia would take the group into two of the continent’s largest and strategically important markets outside its existing footprint.
Gachora said NCBA is “actually looking for opportunities” in both countries, making clear that the group is no longer discussing them simply as long-term possibilities. He did not name any potential acquisition targets, disclose negotiations with particular banks or provide a transaction timeline.
That leaves the immediate focus on the model NCBA intends to use. The bank is looking for existing institutions that can provide an operating presence in markets where establishing a new bank from scratch would take substantial capital, regulatory work and time.
The approach follows the logic behind Nedbank’s acquisition of NCBA itself. TechTrendsKE’s earlier reporting on the transaction highlighted the value Nedbank placed on NCBA’s established regional franchise and digital banking capabilities, including its digital lending platform and technology infrastructure.
Gachora rules out greenfield banking entry
Gachora’s strongest disclosure at Bullish Africa was his view of greenfield expansion.
“I don’t believe at this point, even where banking is, that green fields work,” he said. “So if we’re going to those markets, you can be sure that we still pay for acquisitions.”
That is more definitive than simply saying NCBA prefers acquisitions. His comments suggest that if the bank enters DRC or Ethiopia, it expects to do so by buying an existing financial institution rather than establishing a new banking operation from the ground up.
An acquisition can give a bank immediate access to a local licence, customers, deposits, distribution infrastructure, employees and established relationships with businesses and regulators. It can also bring technology systems and digital channels that would otherwise have to be built or assembled independently.
NCBA has not disclosed what characteristics it would prioritise in a target, however, and the transcript does not establish whether any acquisition is currently under negotiation.
Africa’s banking expansion is taking different routes
NCBA’s approach is becoming more interesting as other large African banking groups pursue the same broad objective through different models.
Standard Bank, for example, has been building its East African franchise organically while keeping acquisitions and partnerships available if suitable opportunities emerge. The group said in September that it had about R21 billion, equivalent to roughly KSh166.7 billion, available across acquisitions, partnerships, dividends and share buybacks. It has not allocated that amount specifically to acquisitions in Kenya or elsewhere.
Standard Bank has also been evaluating Ethiopia, but its circumstances there illustrate why banking groups can reach different conclusions about how to enter the same market. Stanbic has considered establishing a wholly owned operation in Ethiopia, partly because foreign ownership restrictions make taking control of an existing local bank more difficult.
NCBA’s position is therefore particularly notable. Gachora is saying that, from NCBA’s perspective, the economics of building a greenfield bank in its next target markets do not make sense at present.
That creates an interesting contrast between two South African banking groups with ambitions across East Africa. Standard Bank is prepared to build organically and retain acquisition options, while NCBA is explicitly looking for acquisitions as it moves into DRC and Ethiopia.
Technology could become part of the acquisition value
The technology implications are significant because the value of a banking acquisition increasingly extends beyond its balance sheet and physical distribution.
NCBA’s digital capabilities were already part of the strategic case around the Nedbank transaction. TechTrendsKE reported that the Kenyan bank had built substantial digital lending capabilities alongside a cloud-native corporate banking platform using microservices and open banking APIs.
An acquired institution could therefore provide NCBA with the local banking infrastructure while its existing technology capabilities potentially provide another layer of value.
That does not mean NCBA can simply transplant its Kenyan technology stack into another country. Core banking systems, payment rails, identity infrastructure, regulatory requirements and customer behaviour differ from one market to another. The technology integration after an acquisition can become a major project in its own right.
CRDB’s experience provides a useful regional example. The Tanzanian bank has operations in Tanzania, Burundi and DRC and has built an enterprise integration backbone connecting digital channels, partners and underlying banking systems while supporting its migration to Temenos Transact. The architecture is designed to reduce dependencies between systems, standardise APIs and make it easier to reuse capabilities across markets.
For NCBA, the lesson is relevant even though the technology environments are different. Acquiring a bank may solve the question of local market entry, but integrating that institution into a broader regional banking platform can determine how much value the acquisition ultimately creates.
DRC and Ethiopia present different opportunities
The two markets also have different digital-financial environments.
Ethiopia’s banking sector is opening to greater international participation while digital payments and financial infrastructure continue to develop. Dashen Bank’s five-year partnership with Visa, for example, covers payment acceptance, card issuance, cross-border transactions and digital payment services. That points to a market where payment infrastructure and digital customer experiences are becoming important parts of competition.
DRC presents a different operating environment, but it is already part of the regional expansion strategies of other African financial institutions. CRDB’s presence in DRC and its multi-country technology architecture show how banks are approaching the country as part of a broader regional network rather than treating it as an isolated operation.
For NCBA, the acquisition route could provide an established base in either market while avoiding the long build-out associated with launching a new bank. The technology question would then become how much of NCBA’s existing digital infrastructure and operating model can be adapted to that local platform.
The wider banking market is becoming more competitive
NCBA’s plans also fit into a broader contest for scale among African banks.
Kenya has become an important base for regional banking groups because of its corporate sector, payments ecosystem and connections to neighbouring markets. Standard Bank has described Kenya as a strategic platform for building a larger East African business, while Nedbank has used its NCBA transaction to establish a stronger presence in the region.
At the same time, Kenya’s banking sector is already deeply digital. Mobile money penetration has passed the 100 percent subscription-to-population threshold, while digital payments, merchant services and financial technology partnerships continue to expand the range of services available through electronic channels.
That makes technology and distribution increasingly relevant to the value of an existing banking franchise. A bank with customers, deposits and regulatory approvals is one asset; a bank that can also connect those customers to efficient digital channels, payments and financial products can offer an acquirer a different set of possibilities.
This helps explain why acquisition strategies among African banks cannot be viewed solely through the number of branches or size of the balance sheet.
The next question is what NCBA buys
Gachora has provided the direction, but the eventual targets will determine what the strategy means in practice.
A retail-focused bank could give NCBA immediate access to consumers and deposits. A corporate-heavy institution could provide relationships with large businesses and trade flows, while a digitally advanced lender could reduce the technology work required to integrate the acquired operation.
The regulatory environment will also influence the choices available to NCBA, particularly in Ethiopia, where foreign participation has historically faced ownership restrictions. The group will have to weigh control, valuation, technology compatibility, capital requirements and the ability to integrate the acquired business into its existing regional structure.
For now, none of those details has been disclosed.
What Gachora has made clear is that NCBA’s next expansion will look beyond its current East African footprint, with DRC and Ethiopia at the front of the queue. He has also made clear that the bank does not intend to build greenfield operations in those markets if it can instead acquire an established institution.
That puts NCBA alongside a growing group of African banks pursuing cross-border scale, but with a more explicit acquisition-led model. Following the Nedbank transaction, the next chapter of NCBA’s regional strategy may therefore be defined by what it buys, how those businesses can be integrated and whether the technology capabilities developed in Kenya can be adapted successfully to a much broader African footprint.
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