This after Barclays Kenya recently announced a 13 million dollar deal with a unit of British oil explorer, Marriot Drilling, to fund an oil rig in Kenya.
“Being part of lending an institutional investor also shields you from the prospective of non-performing loans and we have seen a lot of banks suffering from non-performing loans,” Kithinji, a research analyst at Standard Investment Bank, told CNBC Africa.
The financing is spread over five years and the East African country has attracted a lot of attention after oil discoveries there last year.
“I think it has become more of a strategy for them to go back to do a lot of institutional lending, more specifically asset financing, and for them they’re able to strike these deals because they can have the arrangement not just with Barclays here but with the Absa group in South Africa,” said Kithinji.
She added that the Barclays Africa merger has given Barclays Kenya the muscle it needs to bid for big lending deals.
“They’re not doing it solely on their own because these are big projects and they also have other lending agendas that they want to push through. I think this would be part of a consortium or part of a partnership,” Kithinji indicated.
“Infrastructure is one of those projects that take a while to pay off but when they do, they really pay off for a long time. It’s patient capital and I think that’s the route Barclays wants to go because they are more of a long-term player in the market – they like longer term projects.”