NIC Bank bets on leasing subsidiary to grow business

Kenya: Listed lender NIC Bank has opened a new leasing subsidiary, NIC Leasing Ltd to tap into the growing opportunities in the leasing market.

The introduction of NIC Leasing Ltd follows the bank’s growth in the asset financing category. The subsidiary will enable the group to offer customers the asset, financing solutions as well as insurance through their Bancassurance subsidiary.

This is after the bank received approvals from the regulator, the Central Bank of Kenya to set up the subsidiary in December last year. The operating model employed by NIC Leasing will see NIC Bank partner with Mercantile Finance, another wholly owned subsidiary of the bank.

Group Managing Director John Gachora said the move to set up the new subsidiary fits into the bank’s growth strategy, especially in the competitive asset financing sector.

He said the Government is taking the lead especially in the leasing of motor vehicles and medical equipment, adding that the platform offers companies various advantages including optimised cash flow management by freeing up capital which can be invested in other areas of the business.

“Leasing is slowly gaining traction in the Kenyan market. Recent leasing initiatives by the Government are a positive move towards growing the market and we are confident that NIC Group is well positioned to support this growing market,” said Gachora.

Consumer goods

NIC Bank Executive Director for Corporate Banking Alan Dodd said the subsidiary will be looking at assets such as motor vehicles as well as focusing on leasing equipment in the fast moving consumer goods, construction and healthcare sector.

“Previously, we would link customers with leasing companies and provide the financing. With NIC Leasing we are now able to provide the equipment and the financing all under one roof,” said Mr Dodd.

“Through NIC Leasing we intend to offer professional services to our customers from inception, during the lease and at the end.”

NIC Bank worked with renowned international leasing consultant Sudhir Amembal to set up the subsidiary.