Joshua Oigara, the Chief Executive Officer of KCB Group, Kenya’s biggest lender by assets, announced the company’s plans to buy a bank in Rwanda and one in the Democratic Republic of the Congo (DRC).
Speaking to reporters, Oigara did not reveal the identity of the two banks the lender is considering acquiring or the timeframe. He however revealed that KCB Group is also planning to open a representative office in China, to take advantage of growing trade links between East Africa and China.
Kenyan banks have announced several deals since the government capped commercial lending rates in 2016, a development that reduced profit margins and forced banks to look for several survival strategies including consolidation.
Last month, KCB offered to buy National Bank of Kenya (NBK) in a swap of one KCB share for 10 NBK shares, in a deal seen helping NBK out of its perennial liquidity challenges. Similarly, CBA Group, a privately held bank, is in the process of merging with NIC Bank to form the third biggest bank by assets in East Africa.
Equity Group, the second largest bank by assets, said it was in talks with London-listed financial services firm Atlas Mara Limited about acquiring stakes in banks in Rwanda, Zambia, Mozambique and Tanzania.
There have also been many smaller transactions, including Diamond Trust Bank’s acquisition of Habib Bank Kenya in 2017.