Equity Bank #ticker:EQTY chief executive James Mwangi on Tuesday made a retreat over his retirement plan on a day when the lender announced a 12 percent growth in net profit for the nine months to September.
Mr Mwangi, who has served the bank for 29 years, told a media briefing that he wanted to cement Equity’s expansion in Africa over the next two decades before calling it quits.
Equity Group reported Tuesday that its nine-month net profit rose to Sh17.46 billion, up from Sh15.58 billion in a similar period a year ago as it overcame the effects of an interest rate cap that slowed down economic growth.
Mr Mwangi had recently talked of leaving the bank’s executive suite to join its foundation—which is the social arm of Equity Group.
“The earliest maybe on my own volition that I would ask to retire is when I turn 75,” said Mr Mwangi, who is 57.
“I have another 20 years. I take consolation from one of my role models, Warren Buffett who is still chief executive at the range of 87.”
Mr Buffett, 89, an American business magnate and investor, is the chairman and CEO of Berkshire Hathaway.
Mr Mwangi’s intention to serve longer will cement his position as one of the longest tenures among publicly traded firms.
He joined the bank as finance director before rising to chief executive in the 1990s when Equity was still a building society.
The bank has since then expanded in the region with operations in Uganda, Rwanda, Tanzania and South Sudan while rising to be the country’s most profitable lender.
Equity is the first bank to report its results after Kenya lifted a cap on lending rates, which policymakers said had stifled credit, especially for small businesses, and hindered monetary policy.
“The faster growth in total income above net interest income reflects success of the strategic pursuit of the group to grow quality income through non funded income growth,” said Mr Mwangi.
Equity’s total assets rose to Sh677.1 billion from Sh560.4 billion in same period in 2018, while loans and advances to customers grew 21 percent to Sh348.9 billion.
About 800,000 Equity customers were locked out of borrowing from the bank after the cap was introduced in 2016, Mr Mwangi said, adding that the bank now has an opportunity to win them back, since they are still saving with the lender.
Equity’s Kenyan business contributes the bulk of its profits, but its subsidiaries in Tanzania, Rwanda, Burundi, South Sudan, Uganda and Democratic Republic of Congo grew their assets by 26 percent in the period.
They now account for more than a quarter of the bank’s total assets. Equity plans for its subsidiaries in East and Central Africa to account for 40 percent of its assets.
As part of its growth strategy, the bank is pursuing mergers and acquisitions in the region. Equity said in September it was in talks with Banque Commerciale du Congo’s (BCDC) shareholders to buy a controlling stake for cash.
Equity already has a subsidiary in Democratic Republic of the Congo, which has a population of 80 million.
Ethiopia is also a target, Mr Mwangi said, as Africa’s second most populous nation prepares to liberalise its financial sector.