KCB Group is still pursuing another buyout deal in Tanzania even after it stepped away from the proposed transaction with UK-based Atlas Mara Limited for a complete acquisition of BancABC Tanzania in November last year.
“We had a final conversation with BancABC in December. Our focus largely today is on other countries. Tanzania is something we will come back to perhaps in the second half of this year,” said KCB Group CEO Joshua Oigara in a recent interview with NTV’s Julians Amboko.
The Atlas Mara deal with the Kenyan bank for a stake in BancABC is reported to have hit a regulatory minefield, forcing the Kenyan lender to drop its bid for the Tanzanian Bank.
Oigara has disclosed that the lender will from July this year resume talks on possible acquisition targets in Tanzania, considered one of Kenya’s largest trading partners in the Eastern Africa region.
The Kenyan Bank successfully acquired a 62.06 percent stake in Rwanda’s Banque Populaire du Rwanda Plc (BPR) in August 2021 from Atlas Mara, a deal that will make KCB the second biggest lender in Rwanda.
KCB now owns 76% of BPR, with plans to eventually get to 100%.
According to a research note from Renaissance Capital, there have been no negative asset quality surprises on BPR’s book, and it is expected to surpass KCB Rwanda on financial performance in 2022, according to the lender’s management.
The Kenyan lender said it intends to maintain the BPR brand in Rwanda to give it a more indigenous feel due to its larger retail footprint and bigger balance sheet/staff/customers albeit with a smaller P&L.
KCB’s strategy in Rwanda will revolve around high-end SMEs and corporates, with BPR offering a good retail angle.
The listed lender is said to be pursuing other strategic options in its regional expansion strategy in the second half of 2022, including the Democratic Republic of Congo(DRC) where its closest rival Equity Group already has a presence.
KCB said its expansion plans in Ethiopia could take a bit longer due to the ongoing political instability and civil unrest in that country.
ALSO READ:KCB Cancels Acquisition of Tanzania’s African Banking Corporation
