Companies

KCB receives regulatory approval to merge Rwanda operations

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A KCB branch in the Southern province of Rwanda. PHOTO | CYRIL NDEGEYA | NATION

KCB Group #ticker:KCB has received regulatory approval from the National Bank of Rwanda (BNR) to merge its newly acquired Banque Populaire du Rwanda (BPR) and KCB Bank Rwanda. 

The two banks will now operate as a single entity named BPR Bank Rwanda Plc, with KCB Group as the majority shareholder effective April  1, 2022.  

The combined entity will become the second-largest bank in the Rwanda banking industry.

The merger is also set to give KCB a larger footprint in retail banking in Rwanda, building on its existing corporate business that has been the strength of KCB Bank Rwanda.

“BPR, as we know it today, has a lot of potentials. The success of this business will build on our era of undisputed leadership in the market and contribute towards Rwanda’s economic success journey. I am confident that we can re-write Rwanda’s next chapter of development and economic growth,” said KCB Group chief executive Joshua Oigara Thursday.

Subsequently, the BPR Bank Rwanda Plc Board has approved a new organization structure for the integrated entity which takes effect immediately subject to governance approvals obtained from BNR. 

Mr George Odhiambo, a seasoned banker has been appointed as the Managing Director BPR Bank Rwanda Plc. George was the Managing Director of KCB Bank Rwanda. 

“The structure has considered the necessity of smooth post-integration transition with minimal business and human capital disruption whilst retaining key talent resources as well as alignment to the KCB Group Structure for support and governance,” said Mr Oigara. 

KCB announced in November it had signed a deal with Atlas Mara to buy 62.06 per cent stake in BPR and a 100 per cent stake in Banking Corporation Tanzania (BancABC), with the latter awaiting approvals from regulators.

The lender in January however  said it is still open to pursuing another bank buyout in Tanzania after dropping its bid to acquire BancABC Tanzania from London-based Atlas Mara Limited.

Kenya’s high rate of financial inclusion and digital banking have pushed local lenders to look outside the country’s borders for growth.

The resultant acquisitions have seen both KCB and Equity Bank Group boost their asset base to over Sh1 trillion each.

The KCB deal comes months after Equity Bank Group called off its plan to acquire four banking subsidiaries in Rwanda, Zambia, Tanzania and Mozambique from Atlas Mara Limited in a move aimed at preserving its capital in the wake of the Covid-19 pandemic.