NCBA Bank Kenya has taken over a KSh 860 million loan from Absa Bank Kenya to Unga Group, which was due in June 2024.
- The 6-year term KSh 860 million loan was issued in 2017 to Unga Group to finance the purchase and construction of a new wheat milling plant in Eldoret.
- The NCBA loan has a higher interest rate than Absa – currently charged at the Central Bank Rate (CBR) plus 6.35% Margin to Absa’s interest rate of the CBR plus a 3% margin.
- The listed miller saw its bank loans double in the year ended June 2024, totalling KSh 2.3 billion from KSh 1.1 billion in 2023 as high interest rates lingered.
“The facility taken over by NCBA from Absa Bank, comprised a six-year term loan of KSh 860 million taken in 2017, to finance the purchase and construction of a new wheat milling plant in Eldoret,” Unga Group noted in the annual report.
Unga has a composite facility from NCBA bank in US dollars and Kenyan Shillings comprising overdraft facility, invoice discounting, bank guarantees, stock loan, letters of credit, post import finance and invoice discounting amounting to KSh 530.2 million.
In the full year ended June 2024, Unga Group made a net loss of KSh 669.6 from a bigger loss of KSh 959.4 million on the back of reduced finance costs and narrowed operating loss helped by the strong shilling.
