Equity sets aside Sh500bn with eyes beyond the EAC
Equity Group Holdings boss James Mwangi and Group Head of Financial and Regulatory Reporting Mary Nteere during the announcement of the bank’s profits on Tuesday.
Equity Group has set aside Sh500 billion to finance Kenyan and South African businesses seeking to trade or invest on the continent.
The idea to expand its reach beyond the seven countries where it already operates.
The bank will offer credit to entities that want to set up manufacturing, construction, health and investment firms, facilitate value addition through processing and packaging and finance export or import businesses.
Out of the money, close to Sh100 billion will be from development institutions such as the African Development Bank (AfDB) and the rest from customer deposits.
The bank is eyeing South African firms to establish its presence there without setting up physical branches, and raising competition for other financiers such as Absa and Standard Bank.
“We have put into disposal of private sector and business community about Sh500 billion to facilitate trade. We will be funding Kenyan importers or South African firms that want to export into the regions we operate in or those that want to do partnership in the region.
Regional reach
“We’re inviting them as new investors in the regions,” Equity Group chief executive James Mwangi said.
Local banks including KCB Group, NCBA Group, I&M Group and DTB Bank have been expanding their regional reach by setting up branches or acquisition in Rwanda, Malawi, Uganda, Tanzania, South Sudan, Malawi, Botswana and DRC, thus exporting competition beyond Kenya.
Equity recently merged its operations of Equity Bank Congo with its acquisition of BCDC to form Equity BCDC, bolstering its assets to cross the trillion mark to Sh1.12 trillion as at six months to June.
Mr Mwangi said the bank’s strong customer deposits and credit facilities from African and global organisations that amounted to Sh63.25 billion as at March, will help facilitate the funding.
“We believe South Africa has very well established firms, but terrain in East Africa is very different, and that’s why we’re promoting collaboration for investment and partnership between the companies,” Mr Mwangi said.
