Of the about 45 banks in Kenya, 35 are localy owned and 10 foreign owned with 3 of these having substantial GoK holding. Like them or not, the Asian-owned banks make up most of tier 2/ a lot of the locally owned banks in town. And a good no. of locally owned banks are run by families eg:
Merali - Equatorial Bank
Manu Chandaria - Fina (South Africans bought stake) & Guardian
Moi n Family - TransNational Bank
Total Man - Middle East Bank
Kenya's banking industry is growing, but is not yet mature.
The level of financial sophistication/ innovation is low - for instance, product-wise they offer almost the same products, showing little innovation/ creativity and thus making the quality of service delivery THE key differentiator. I mean all of them offer current and savings accounts, and the difference bewteen these at bank A or B is minimal, if any!
Some folks say the kenya banking sector is over-banked and we should do a Nigerian and reduce these to about 20 well-capitalised banks the way Nigerians reduced their 85 banks to abt 25 only. But even with all these 45 banks the level of unbanked kenyans is still high at >4m folks. Safaricom has happily snapped the 4m up on MPESA where the subscribers run online accounts.
But IMHO, M&As will be slow in happening despite the recent merger & acquisition of City Finance, as well as Southern Credit & Equatorial Bank's merger. Each bank clearly wants to retain its identity, painfully created over time. On the products/services front - mergers & acquisitions don't really bring home any new products or services as it is merely an acquisition of what has been established - take Stanbic for instance, so they acquired CFC but what new products have rolled of the new larger bank? Zit! Stanbic merely acquired CFC's large retail business/ brand.
Case of NBK?