Nigeria’s Top Lender Zenith Takes Over Kenya’s Paramount Bank as Gateway to East Africa

Zenith Bank has completed the acquisition of Paramount Bank Kenya Limited, marking its entry into East Africa’s largest economy and reinforcing its push to diversify earnings beyond Nigeria.

In a statement on Tuesday, the lender confirmed it had acquired 100 percent of the issued share capital of Paramount Bank following the receipt of all regulatory approvals in both Kenya and Nigeria.

“This acquisition marks a significant step towards our long-term strategic growth agenda and a strong inroad into the East African markets,” the bank said. “It reinforces our position as a leading financial institution in Sub-Saharan Africa and affirms our strategy of following our customers’ businesses.”

The expansion comes as the banking group reported a profit after tax of N1.04 trillion for the 2025 financial year, up marginally from N1.03 trillion in 2024, according to its audited financial statements.

The performance cements Zenith’s position as Nigeria’s most profitable lender, underpinned by strong core banking income and improved operational efficiency.

Strategic expansion into East Africa

The deal gives Zenith a foothold in Kenya’s competitive banking sector, as Nigerian lenders increasingly look beyond their home market for growth opportunities.

Paramount Bank, a tier-three lender, met the Central Bank of Kenya’s KSh3 billion minimum core capital requirement in November 2025, reporting KSh3.118 billion after a shareholder capital raise, according to Mwango Capital, a Nairobi-based research firm.

The banking group had earlier secured clearance from the Competition Authority of Kenya in January, removing a key regulatory hurdle for the transaction.

The acquisition reflects a broader trend among African banks seeking expansion into faster-growing regions, particularly East Africa, where financial inclusion and economic growth remain relatively robust despite global headwinds.

Shifting earnings mix

Zenith’s latest move also aligns with its strategy to reduce reliance on Nigeria, which has historically contributed as much as 90 percent of group earnings.

The bank is targeting a more balanced geographic mix, with plans to generate up to half of its profits from outside Nigeria over the medium term.

Recent data show progress on this front, with foreign subsidiaries accounting for 27 percent of profit in the first nine months of last year, up from 14 percent in 2024.

Beyond Kenya, the company has also signalled plans to expand into Ethiopia—Africa’s second most populous country—as it deepens its continental footprint.

Capital deployment drive

Nigeria’s recent banking recapitalisation exercise is accelerating this outward expansion.

In January 2025, Zenith raised N350.4 billion ($242 million), lifting its paid-up capital to N614.6 billion ($425 million). With stronger capital buffers, the bank—like many of its peers—is now seeking higher returns by deploying funds into new markets as domestic earnings begin to normalise after a period of windfall gains.

The transaction also comes with conditions, including a requirement to retain Paramount Bank’s 78 employees for at least 12 months post-acquisition.

Contrasting global trends

The group’s expansion contrasts with the retreat of some international lenders from Africa in recent years. Banks such as Standard Chartered and HSBC have scaled back operations across parts of the continent, citing profitability and regulatory challenges. The move also signals continued confidence among African lenders in selective regional expansion, particularly in markets with favourable demographics and underpenetrated financial systems.