KCB Group has injected and extra $8.9million (shs905million) to boost its share capital in both the Rwanda and Tanzania units.
The group said its Rwandan unit has received a new capital investment of $3.8million (Sh386 million). The Rwandan subsidiary also operates 14 branches with a cumulative investment worth $21.7million (Sh2.2 billion).
“Economies like Rwanda and Tanzania have demonstrated the capacity for higher returns in the financial services sector,” Group chairman Andrew Kairu said.
According to the Groups latest annual report, its Tanzanian subsidiary received Sh519 million in the year ended December. This raised its total investment in the unit, which also runs 14 branches, to Sh3.5 billion.
In his argument, Kairu noted that Kenya is overbanked compared to peers in Africa such as Nigeria and South Africa and that better returns may be realised in subsidiaries.
KCB Group latest move is critically being viewed in the same lense as that of Equity which added Sh1 billion in its Tanzanian unit while NIC Group also provided an extra Sh350 million of new capital to its unit in that market.
KCB Group is Kenya’s biggest lender by assets.
At the begining of May, the Groups CEO Joshua Oigara said they are planning to acquire two banks – a bank in Rwanda and one in the Democratic Republic of the Congo (DRC).
Rival giant Equity Group, has already entered a swap deal with in London-listed financial services firm Atlas Mara Limited acquiring stakes in banks in Rwanda, Zambia, Mozambique and Tanzania.