Stanbic Bank Kenya has won a major client in Devki Group, an industrial conglomerate whose operations span cement, steel, roofing and packaging materials.
The Kenyan multinational, founded by Narendra Raval, previously relied almost exclusively on KCB Bank Kenya where it has been a client for more than 40 years.
The company recently moved a substantial part of its business to Stanbic Bank which has been growing its corporate banking business, supported by its parent firm Standard Bank Group in case of major lending deals.
Having a major client helps a bank across multiple business lines including lending, deposit, foreign exchange and advisory. Devki, a private firm, does not disclose its financial statements but is one of the country’s largest companies by revenue and employee numbers.
“I have taken between 30 percent to 40 percent of the business to Stanbic Bank. They have better rates and customer service. We still bank with KCB where we have been a client for more than 40 years,” Mr Raval told this publication.
The step comes soon after the lender hired Joshua Oigara — who led KCB Group from January 2013 to May 2022 — as its new chief executive. Mr Oigara took his new role at Stanbic in December 2022.
Stanbic announced last week that it had provided a Sh4.3 billion credit facility to National Cement Company Ltd, one of the subsidiaries of Devki Group.
“The Sh4.3 billion term debt facility will empower National Cement to continue delivering high-quality construction inputs at competitive prices, furthering economic and infrastructure development initiatives. As a key supplier across East Africa, National Cement’s operations are integral to driving growth and prosperity in the region,” Stanbic said in a statement.
The bank added that it provided National Cement with a comprehensive financial solution, including local currency term debt and customised foreign currency forwards.
Stanbic said this tailored approach optimised the client's foreign currency exposure relative to domestic operations and addressed challenges posed by volatile forex market dynamics.
Devki’s cement subsidiaries have been on an aggressive expansion in the local and East African markets, fuelled by borrowings from banks and the International Finance Corporation (IFC).
National Cement, for instance, paid Sh5 billion to acquire the Kenyan assets of ARM Cement that went into administration after defaulting on its debt. KCB provided Sh3.5 billion of the funds used in the transaction.
Cemtec Simba Cement Company, part of the Devki Group, opened a Sh45 billion clinker plant in West Pokot County earlier this week. Clinker is an intermediary product used in the production of cement.
In January, National Cement completed the buyout of Rwanda’s cement manufacturer Cimerwa Plc for $84.3 million (Sh13.6 billion at the exchange rates at that time).
