Kenya: Equity Bank goes regional
Nairobi, Kenya, December, 14 2007 -
Kenya's fastest growing bank is set to expand its operations to Eastern Africa come next year by opening branches in Uganda, Tanzania, and Rwanda.
The bank will also move to South Sudan, the new emerging investment destination for many a Kenyan companies.
Equity which only three years ago converted into a bank from a building society , plans to open the subsidiaries in the region beginning with Uganda followed by Tanzania and then Rwanda by August next year before moving to Juba.
The bank popular with small savers and reputed for it’s micro-finance specialty will join the big league of big Kenyan firms that have gone regional since 2002, taking advantage of the vibrancy of the East African Community (EAC) .
According the CEO James Mwangi, the bank plans to use funds raised from sale of 24% shareholding to American investment group Helios SEB, to expand into the region the ultimate aim being to boost it’s profitability.
The bank recently raised Ksh 11 billion (1ksh =$64) from the sale of the stake to the American group making it the highest capitalized bank in the country at Ksh 21 billion in shareholders capital.
The injection of the funds by Helios SEB group firmly placed the indigenous bank firmly in the big league of the Kenyan financial sector, for years dominated by multinationals, Barclays, Standard Chartered and local bank Kenya Commercial bank (KCB).
“Our ambition is to go regional and replicate our Kenyan success to other countries in the region” the CEO said.
Mwangi said that the popularity of the bank among Kenyans and its high rating by international bodies gave it’s management confidence that it was set for bigger things in the region.
The banks he added was confident of doubling it’s customer base in the next 5 years owing to it’s sound micro-finance policy which he said had wakened big banks from slumber , after years of shunning low income groups.
When it plans come to fruition , the bank will be joining other Kenyan firms that have spread tentacles into the EAC region, including KCB, UAP Insurance company, East African Portland Cement ,Bidco Oil company, petroleum dealer Kenol/ Kobil and East African Cables, all which have opened subsidiaries in the past few years.
Kenya Commercial bank has for more than 5 years now operated a branch in Dar-esaalam and last year opened 2 branches in South Sudan’s towns of Juba and Rumbek.
Founded in 1984 in central Kenya with main customers as small scale tea and coffee farmers, the bank now has a customer base of 1.8 million an equivalent of 30% of all bank accounts held in 54 local banks.
Just 2 years after being licensed as a bank , Equity’s profit hit the Ksh 1 billion mark last year earning it respectability and even vicious propaganda and claims of instability from rivals in the banking sub-sector.
Targeting ordinary Kenyans who other banks would not touch with a ten-foot pole, the bank has revolutionalised banking in Kenya, by taking affordable banking services to the people earning it recognition internationally.
The united nations Development Fund (UNDO) ranked as the third best micro-finance bank institution last year and the best in Africa and appointed Mwangi as an advisor on micro-finance.
The G8 summit leaders meeting this year also gave the bank an award of excellence for offering financial services to the poor raising it’s profile even higher.
Currently, equity is disbursing a Ksh 7 billion UN fund , meant to be advanced to women entrepreneurs in Kenya.