Kenya’s Equity Bank Group plans to expand its operations into the Democratic Republic of Congo by acquiring a 79 per cent stake in ProCredit Bank Congo, its chief executive officer said on Tuesday.
James Mwangi, the CEO of Equity Bank, which focuses on the lower-income part of the market and also operates in Uganda, South Sudan, Tanzania and Rwanda, told a news conference the move was subject to regulatory approval but did not give a time frame for its entry, nor the cost of the investment.
“Today we announce the objective of making our first step outside east Africa,” Mwangi said.
“In terms of entry, we have decided this country is too big to do a greenfield. We have decided to acquire a bank,” said Mwangi, whose term was extended in April by 10 years.
The rest of the stake in ProCredit will be owned by Germany’s state controlled development bank KfW and the International Finance Corporation (IFC), the World Bank’s private sector investment arm.
Earlier this month, Mwangi said Equity plans to expand to Democratic Republic of Congo, Burundi, Zambia, Zimbabwe, Malawi, Mozambique, Botswana, Ghana and Nigeria, as well as Ethiopia, currently off limits to any foreign bank.
The bank reported a 13 per cent rise in first quarter pretax profit to 6.11 billion shillings.
The bank has said it is testing a mobile phone-based banking service, Equitel, which it aims to launch in July and break even by September.
Equity has 768,000 active SIM card users after launching its network in partnership with telecoms operator Airtel Kenya, a unit of India’s Bharti Airtel, aiming to take on market leader Safaricom’s M-Pesa money transfer service.
Equitel users can transfer money, access credit and make payments by phone. It also offers typical mobile services of calls, text messages and Internet browsing.