KCB East Africa: The Kenya Commercial Bank has signed a major deal that will see it acquire two regional banks. KCB signed the deal with London-listed financial services firm Atlas Mara Limited. This deal will allow KCB to buy stakes in it’s banking units in Rwanda and Tanzania.
These units are Banque Populaire du Rwanda Plc (BPR) and the African Banking Corporation Tanzania (BancABC). According to the deal, KCB will the acquire a 62.06 per cent stake in Banque Populaire du Rwanda Plc and a 100 per cent stake in African Banking Corporation Tanzania.
“The transaction fits within the Group’s expansion strategy and will see us increase our market share and distribution network across Rwanda and Tanzania and improve our operating leverage by enabling us to deliver our existing product offerings to a wider base of customers while positioning the bank for sustainable growth in the long-term,” KCB chief executive officer Joshua Oigara said.
The deal comes a two weeks after KCB announced its results for the first nine months of the year. In these results, KCB posted net earnings of Sh. 10.8 billion in the review period compared to Sh. 19.1 billion the year before. This was a 43.1 per cent net profit drop, which was attributed to a sharp increase in provisions for coronavirus-related loan defaults. “The performance was largely impacted by increased provision on loans and advances in the wake of increased risk of credit default associated with the Covid-19 pandemic,” KCB said in a statement. KCB East Africa.