Republic Bank rules out an immediate takeover of HFC bank

The biggest financial institution in the Caribbean, Republic Bank, has indicated that it has no intention of taking over HFC bank now, Joy Business has learnt.

Republic Bank disclosed this in an application to the capital market regulator SEC, asking for an exemption from a mandatory takeover of HFC Bank.

Joy Business has gathered that the current Securities and Exchange Commission code on takeovers and mergers require Republic Bank to make a mandatory offer to shareholders of HFC Bank for a takeover.

This was after the Caribbean bank increased its stake in HFC to 32 per cent last Friday, making it the single largest shareholder in the bank.

Giving reasons for their plan, Republic Bank said because it has not gotten a deeper understanding of the African and Ghanaian market, it would like to wait a while before looking at the takeover option.

Meanwhile, the Securities and Exchange Commission is expected meet on the application of Republic Bank by the close of week to consider their request. Sources say the regulator is likely to approve their demand.

In a related development the Bank of Ghana has also approved the acquisition of 23 percent shares of a private equity capital fund, Aureos Africa, in HFC Bank, which has increased republic bank's stake to 32 per cent.

Joy Business has learnt the approval was given last month.