Victoria Commercial Bank bought additional shares worth Sh20.08 million in a Nairobi-based kindergarten, Montessori Learning Centre, during the financial year that ended December 2023, marking the latest financial injection into the British curriculum-focused school.
The lender in 2021 acquired a 24.9 percent stake in Montessori in a debt swap deal after the Nairobi-based school defaulted on a Sh200 million loan on the back of Covid-19 disruptions.
Victoria discloses in the latest annual report that it has invested Sh20.08 million in the school, adding to the Sh11.16 million it injected into the institution last year. The lender says its stake has, however, remained unchanged.
“During the year, the bank subscribed to additional shares of the school at a consideration of Sh20.08 million. These additional shares did not result in any changes in the percentage of ownership by the bank,” said the lender.
Montessori’s loss after tax for 2023, attributable to the owners of the company, was Sh93.86 million, more than three times the Sh30.5 million. Victoria’s share of loss from the institution was Sh23.37 million, compared with Sh7.59 million loss.
Victoria’s stake in the school and the fresh investment continue to be rare for a bank. The Central Bank of Kenya restricts lenders from owning stakes in non-financial institutions but offers exemptions when the acquisition is a debt swap deal involving a distressed borrower.
Montessori, started in 1998, runs a British curriculum for kindergarten and preparatory school. It also offers an international diploma in early childhood education courses for teachers.
Last year, Victoria posted a Sh723.6 million net profit from Sh649.5 million in the previous year, in a performance that marked the third straight year of increased earnings. The lender serves corporate clients.
The bank owns a 24.52 percent share capital of Victoria Towers Limited, an Upper Hill building that houses its head office. Victoria’s share of profit from the tower was Sh12.3 million last year, a drop from Sh16.6 million in the preceding period.
