Equity Bank signals plan to buy stake in local rival


Equity bank on Muindi Mbingu Street in Nairobi's CBD. Picture taken on October 10, 2021. PHOTO | LUCY WANJIRU | NMG

Equity Group is ready to acquire a local rival if acquisition targets emerge, marking a shift to its previous strategy of seeking organic growth.

Equity Group chief executive Dr James Mwangi said this is part of the bank’s growth strategy in the Kenyan market, an approach that had been focused in other regions like the Democratic Republic of Congo and Rwanda.

Mr Mwangi said the growth strategy through acquisition saw it gain a large market share of 27 percent in DRC, compared to organic growth in Kenya.

The Nairobi Securities Exchange-listed lender unlike most tier-one banks has never acquired any lender in the local market, growing through increased customer base and physical branches.

“Instead of acquiring, we chose to be more innovative and attractive. Equity is investing heavily in digitization so that we can acquire the youth by giving them very strong devices like apps and USSD capabilities of banking. This is how we have chosen to grow,” Dr Mwangi said.

‘’However, if there are opportunities that are worth looking at, we could do it because we have done that in DRC that helped us quickly grew. We are now at 27 percent of market share in DRC while our organic growth is still 15 percent in Kenya.”

The bank early this year acquired 7.7 percent stake in Equity Bank Congo (EBC) from German sovereign wealth fund KfW at Sh996 million bringing it shareholding in EBC to 94.3 percent .

It had in August last year acquired 66.5 percent stake in the Belgium’s BCDC.

Equity’s EBC operations were merged to form EquityBCDC, shoring up assets to Sh1.2 trillion as at six months to June.

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