"The target is 51 percent for someone who can bring in management experience and also capital, then 10 percent is supposed to go to the public. The public already holds 4 percent," the source said. "How the actual percentages play out is a function of how they proceed in terms of restructuring. It's an issue of how do you convert the preference shares into ordinary shares? That is the subject of discussions between the NSSF and the government."
The Kenyan Cabinet approved the sale of National and other public enterprises in the east African nation's latest round of privatisation. The Treasury expects receipts of 6 billion shillings ($79.10 million) from the sale of some of the assets in its 2009/10 fiscal year.
The government owns a 22.5 percent stake in the bank and a further 48 percent through NSSF. Its Managing Director Reuben Marambii said last year he preferred would prefer to sell to a substantial local investor and the public.
A leading Kenyan bank, Equity, has said it is interested in acquiring National depending on the terms of the sale. Equity's CEO James Mwangi says National's large portfolio of government securities would complement Equity's large retail network. Other likely suitors for National would be Kenyan lenders looking to expand their branch network and foreign banks keen on gaining a foothold in east Africa's largest economy.