United Bank bets on SMEs for Kenya expansion

United Bank of Africa (UBA Bank) is the second bank from West Africa to enter the local market following the entry of Ecobank in mid 2008.

UBA , which has started a green field operation, is looking at entrenching its presence in the market through a cocktail of banking services and establishment of branches across the country.

The bank intends to leverage on its global reach to provide local businesses with a platform dubbed Afritrade to transact their businesses much more cheaply through the use of trade instruments such as trade finance and letter of credit.

The bank is looking at sharing its global success locally. It recently moved up 161 places to be ranked 285th from position 451 in the latest ranking of the Top 500 Banking Brands by the Banker Magazine.

UBA is one of Africa’s leading financial institutions, offering universal banking to more than seven million customer accounts.

It currently operates in 16 countries including Nigeria, Ghana, Uganda, Cameroon and Côte d’Ivoire. Other countries of operation are Liberia, Sierra Leone, Senegal, Burkina Faso, Chad, Benin, Tanzania, Uganda, Zambia, and Guinea. It also has presence in international markets such as New York, London and Paris.

Business Daily spoke to Mr Manz Denga, the regional chief executive officer of UBA Bank operations and the managing director of Kenya’s UBA operations.

What necessitated the entry of UBA into the local banking industry?

Our entry into the Kenya banking industry is actually belated as UBA’s first attempt to enter Kenya dates back to 2005. In 2005, we applied for a licence to start operation in Kenya as a green field operation.

But the application was turned down on the premise that Kenya had too many banks. We were given the option of entering the market by acquiring an existing bank. At the initial stage, we started negotiating with three banks which we thought we could acquire.

But we differed with the management of the three banks over pricing, with our due diligence indicating we could only offer lower prices than what the owners were asking for.

After failing to agree with the owners of the three banks, we decided to set up our operations in Uganda where we started in 2007.

In 2008 we re-applied and were granted a licence by the Central Bank of Kenya . We opened up our first branch four months ago. Currently, we have three branches.

What is your business plan for Kenya in terms of expansion and product offering?

We intend to extend our reach throughout the country through branch expansion and products and services targeting all sectors of the economy.