Rabobank Nederland has been allowed to operate a representative office in Kenya, making it the eighth foreign bank to set up operations in Nairobi.
The Netherlands-based bank can now market its products in the country, but is not allowed to undertake banking business.
The Central Bank of Kenya (CBK) in a statement on Wednesday said that it had authorised Rabobank to set up in Kenya, a move that will allow it to expand its business in the region.
“As Rabobank Nederland Representative Office in Kenya discharges its marketing and liaison roles, it will also undertake market research to explore business opportunities to inform the long-term strategy of the bank in Kenya and the region,” said CBK.
In April last year, Rabobank acquired a 28 per cent stake in DFCU Bank Uganda, expanding its African presence to five countries that include Tanzania, Rwanda, Zambia and Mozambique.
Rabobank’s entry in Uganda is expected to boost DFCU’s agricultural lending business, backed by synergies from the former’s long experience spanning close to 60 years and significant expertise in the agricultural value chain.
Representative offices allow foreign banks to market their products and develop relationships that can be used in future when the bank decides to set up full operations.
Bank of Kigali and the Central Bank of India were last year authorised to set up representative offices in Nairobi, joining FirstRand, Bank of China, Nedbank, HSBC Bank, and HDFC Bank.
Kenya’s banking regulator said that Rabobank’s presence stands to benefit from business opportunities that are expected to increase as the country gears towards middle-income status under Vision 2030, adding that the banking sector has continued to attract increasing interest from global brands.
“The entry of international players into the Kenya’s banking sector, contributes towards the sector’s vision under Vision 2030 of creating a vibrant and globally competitive financial sector. The variety of financial products on offer and the resultant competition are envisaged to promote efficiency and accessibility of the banking sector,” said CBK.