Kenya Commercial Bank (KCB) has hinted at buying out one of its longtime arch rivals, Barclays Bank, even as it posted a 16 per cent rise in net profits in 2015 to hit Sh19.6 billion.
The lender, which had posted Sh16.8 billion in net profits in a similar period in 2014, attributed the good performance to a growth in interest income revenue.
The bank, which has operations in Kenya, Uganda, Tanzania, Rwanda and South Sudan, said it grew its interest income by 19 per cent from Sh47.4 billion to Sh56.3 billion for the period ending December 2015.
It also said the performance was further driven by diversified business lines, operational efficiency, non-funded incomes and higher contribution realised from subsidiaries.
The bank said it has been looking at various opportunities to consolidate its position in the bank and the intended sale of Barclays Banks Africa’s business is another opportunity to deepen its market share.
“We are very much open to business. The news (on the exit of Barclays) was tough but it is not the only opportunity in the market,” KCB Group CEO Joshua Oigara said when asked if the bank would consider buying part of the shares in Barclays which will soon come up for sale.
But the bank said it would have to consider all the risks and opportunities that exist before making a move, insisting that it is still too early in the day to tell.
The bank last year completed its restructuring process and is now looking at spreading its wings into DRC, Mozambique and Ethiopia.
“I am happy to inform you that we have now formally transitioned into a non-operating holding company known as KCB Group Limited with effect from January 1, 2016,” KCB Group chairman Ngeny Biwott said at an investor briefing yesterday. Ngeny said the changes saw the incorporation of KCB Bank Kenya Limited, a new subsidiary to run the banking business in Kenya. KCB Group Limited (previously known as Kenya Commercial Bank Limited) will now oversee all KCB Group interests across all markets.
The bank, which opened a representative office in Ethiopia last year says it is waiting for a green light from the Ethiopian government allowing foreign banks to operate in the populous neighbouring country.
“With this move the bank is poised to have an opportunity to serve a country with a population of more than 99 million. The Board and Management are excited with this opportunity,” Ngeny said.
However, the bank’s foreign exchange income dropped by two per cent to Sh4 billion, after it took a beating from foreign exchange nightmare that saw the local unit lose 12 per cent of its value last year owing to strengthening of the dollar. It is, however, South Sudanese business that took the biggest beating from the currency crisis.
