Capital markets

KCB completes the acquisition of the Rwandan bank


A KCB branch in Nairobi. PHOTO FILE | NMG

BDgeneric_logo

Summary

  • The lender has announced that it will merge the new acquisition with its subsidiary KCB Bank Rwanda and rename the combined entity to BPR Bank.
  • The acquisition is expected to give KCB a larger footprint in retail banking in Rwanda, building on its existing corporate activities which have been the strength of KCB Bank Rwanda.

KCB Group #ticker: KCB has completed the acquisition of Rwandan lender Banque Populaire du Rwanda (BPR) from London-listed financial services company Atlas Mara Limited.

KCB Group chief executive Joshua Oigara said the lender has obtained regulatory approvals in Kenya and Rwanda for the deal that makes KCB Group the majority shareholder of BPR.

The lender has announced that it will merge the new acquisition with its subsidiary KCB Bank Rwanda and rename the combined entity to BPR Bank, making it the second largest bank in the country.

The acquisition is expected to give KCB a larger footprint in retail banking in Rwanda, building on its existing corporate activities which have been the strength of KCB Bank Rwanda.

“The completion of the transaction in Rwanda will give the group a stronger advantage in deepening the ongoing strategy to expand the regional presence,” Oigara said.

“The plan is to eventually create a banking entity in Rwanda which will be named BPR Bank by merging KCB Bank Rwanda and BPR.”

KCB announced in November that it had signed an agreement with Atlas Mara to buy 62.06% of the capital of BPR and 100% of the capital of Banking Corporation Tanzania (BancABC), the latter awaiting regulatory approval.

The lender said it is still seeking to secure the deal on BancABC which will allow it to acquire 96.6% stake in ABC Holdings Limited and 3.4% stake in Tanzania Development Finance Company Limited.

Kenya’s high rate of financial inclusion and digital banking has compelled local lenders to seek growth beyond the country’s borders.

The resulting acquisitions saw both KCB and Equity Bank Group increase their asset base to over 1,000 billion shillings each.

The deal with KCB comes months after Equity Bank Group canceled plans to acquire four bank subsidiaries in Rwanda, Zambia, Tanzania and Mozambique from Atlas Mara Limited in a bid to preserve its capital at the following the Covid-19 pandemic.


Source link