Equity Bank counting on CBK to review lending rates

By Athman Amran

Equity Bank is awaiting a policy directive from the Central Bank before reviewing its interest rates, Managing Director James Mwangi has said.

Lending by banks has dropped due to the high interest rates, but Mwangi said the bank has kept its interest rates affordable for the youth and farmers at about 25 per cent. He said the macro-economic conditions are behind the high cost of loans, but Equity is not ready to act unilaterally to lower them as this would distort the CBK’s monetary policy.

Asked how much longer he intends to remain at the helm of the bank, Mwangi said he still has unfinished business at the institution.

Accomplished leader

Mwangi spoke yesterday on the sidelines of his visit to the Standard Group Centre where he met Deputy Chairman and Chief Executive Officer Paul Melly.

Mr Melly described Mwangi as an accomplished leader in the banking industry who transformed a micro-finance unit into a major player.

“He saw an opportunity to build the structure into a major leader in the banking sector,” Melly said.

He said Equity Bank facilitated access to credit by people previously ignored by the industry and made a major difference. Just as significantly, said Melly, the bank influenced the direction of the industry by adopting a model that saw it expand when other banks were closing their branches.

Mwangi said the State should automate all its operations, arguing that there would be more efficiency if the Port in Mombasa, Ministry of Lands offices, and other public institutions were computerised.

The Equity Bank Chief Executive said Kenyans should choose leaders who will have a positive impact on national development.

“Kenyans must up the game in their expectations and demands,” he said, urging leaders to create a Brand Kenya with national values and shun tribal politics. He warned that Kenya is in danger of becoming a net consumer rather than a producer.

“We are becoming indebted. We have to live within our own means,” said Mwangi.

Melly said by winning the 2012 Ernst & Young World Entrepreneur of the Year, Mwangi was at the level of Kenya’s world-class athletes in marketing the country abroad, and attributed Equity’s success to prudent strategies adopted by management.

Dr Mwangi was picked from among 59 finalists vying for the titles across 51 countries, and was recognised in a ceremony held in Monte Carlo’s Salles des Etoiles.

“Even those (investors) who did not want to look at Kenya before will want to see if there are opportunities for investment,” said Melly.

Mwangi said the award was an acknowledgement that Africans can dominate business.

“Africa has now created an environment for international investors,” he said, adding that Africans can achieve anything they aspire for.

He noted that this was a challenge to entrepreneurs to exploit the resources available on the continent.