Should a Pan-African bank acquire a large payments aggregator?

It's a question being asked in real boardrooms right now. The strategic logic is sound. African instant payment systems processed nearly $2 trillion in transactions in 2024, corporate clients feel the gap acutely, and non-funded income diversification is overdue at most large banks. The opportunity is real.

But strategy and execution are two different things.

This week's article works through that gap. I approached it by sitting in the chair of the person who would actually have to approve the deal, a fictional character Mrs. Adaeze Okonkwo, a veteran board member with three decades across Lagos, London, and Singapore, writing a letter to her CEO. Her position is not a refusal. It is a request for rigour.

The analysis examines three things the typical acquisition memo doesn't address:

What the historical record actually shows. Oliver Wyman found that the top global banks completed fewer than 100 fintech acquisitions over a decade, with only 13% exceeding $300 million. McKinsey's data shows large banking deals underperform the banking index by over 800 basis points. The failure pattern is consistent and predictable.

What industries outside banking reveal about asset mobility. The value in a payments aggregator; engineering teams, compliance relationships built across 15 jurisdictions, merchant trust, walks on two feet. What pharma learned from acquiring biotech companies is more instructive here than anything in the fintech literature.

The market cap question that almost never gets asked first. A Nigerian Tier 1 bank committing $300 million to an acquisition is staking 30 per cent of its entire market value on a single integration outcome. A South African bank making the same deal faces a categorically different risk profile. Same strategic logic. Different decision entirely.

Mrs. Okonkwo withholds her verdict. She asks five specific questions before she will reconsider. The article doesn't answer them for her.

Read the full piece here.