SBM Holdings will target to grow organically from the more than 60 branches that it will have once the Chase Bank deal is completed mid-next month.
With a total asset base of Sh542 billion ($5.328 billion) as at September 30, 2017, compared to largest bank in Kenya- KCB Group — with total assets of Sh655 billion, the bank says that it is also keen to achieve growth in markets such as Madagascar, India and the Seychelles.
Mauritian lender SBM Holdings has ruled out making more acquisitions in the Kenyan market as it nears the completion of Chase Bank takeover, its second in under 24 months.
Group chief executive Andrew Bainbridge last week said the lender would instead target to grow organically from the more than 60 branches that it will have once the Chase Bank deal is completed mid-next month.
“It will move us from being a small bank in Kenya to being a mid-sized bank since this transaction will significantly increase the size of our balance sheet and physical presence,” he said.
“What we are looking to do from there is to grow organically. We are not looking at any further acquisitions at this point in time in the Kenyan market — We must not be too ambitious to expand too quickly.”
With a total asset base of Sh542 billion ($5.328 billion) as at September 30, 2017, compared to largest bank in Kenya- KCB Group #ticker:KCB — with total assets of Sh655 billion, the bank says that it is also keen to achieve growth in markets such as Madagascar, India and the Seychelles.
SBM has 10 branches in the country from its Fidelity Bank acquisition, with six located in Nairobi and four in Mombasa.
The lender hopes to use the acquired assets from Chase Bank to reach more customers.
SBM Holdings chairman Kee Chong Li Kwong Wing had said in April the Chase transaction would take SBM Kenya from 31st to 11th place as a strong Top Tier II bank within a year of its creation.
From Chase Bank, SBM will acquire majority of the branches, IT systems and substantial amount of loan book and deposits. The bank plans to rely on the preposition of easy banking and convenience to win new customers.
“We think this is a good vote of confidence and a significant step forward in terms of our strategy of internationalising beyond the borders of Mauritius,” said Mr Bainbridge who has been in Nairobi for a week to review the bank’s progress.
In the financial year ended December 31 last year, SBM Bank Kenya posted a loss of Sh330 million, an improvement from a loss of Sh1.86 billion in the previous financial year.
Standard Investment Bank and Cytonn Investments analysts hold the view that with 40 banks serving a population of about 42 million people, the market is over-banked and remains ripe for more mergers and acquisitions.
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