Co-Op Bank leasing firm lands multimillion Government fleet deal

The Co-op Bank Fleet, a leasing firm has landed Sh 890 million fleet deal with the Government.

The new leasing firm known in short as ‘Ço-op Bank Fleet’ is a joint venture between the Co-operative Bank of Kenya and global leasing specialist Super Group based in South Africa which operates locally through a subsidiary known as Fleet Africa Limited.

This maiden transaction, which is part of a larger Sh2.2 billion deal, entails the financing and delivery of a fleet of 125 vehicles to the Ministry of Interior, the National Police Service and the Prisons Department.

The Co-operative Bank is the financier, with Co-op Bank Fleet arranging the leasing in collaboration with motor vehicle dealers Isuzu East Africa Limited who are to deliver the fleet made up of trucks, pickups and buses.

As a new entrant in the leasing space, Co-op Bank Fleet is likely to rapidly stamp its presence and redefine the leasing game, being a joint venture of two key players who bring to the table complementary capabilities in leasing. Co-op Bank is expected to bring on board its excellent client base to whom leasing is critical such as SMEs, Co-operatives and the Public Sector, while Super Group delivers its proven expertise in customer screening, risk management and product structuring. 

Co-op Bank  CEO Gideon Muriuki lauded the partnership between the two institutions, adding that it strengthens their knack in doing businesses. 

“Super Group Limited is an established global leader in leasing business operating in three continents and is listed on the Johannesburg and Sydney stock exchanges. This partnership between Co-op Bank and Super Group is mutually beneficial as it taps the synergies created by the joint venture,” said Co-operative Bank Group Managing Director & CEO Dr. Gideon Muriuki.

Dr. Muriuki said the leasing business provides an opportunity for the bank to better support customers to acquire the assets, technologies and equipment they require at the same time enable the bank diversify its income streams.

Leasing is widely being seen as the most cost-effective model of acquiring business assets. “Instead of spending all your money buying fixed assets, you can actually lease assets, you’ll be able to lease a lot more assets with the same amount of money,” Edna Kihara the Chairperson of the Leasing Association of Kenya was once quoted as saying.

By embracing leasing as an alternative way of acquiring assets, the National Government has set the pace for counties, who should only be too happy to reduce expenses by adopting leasing.

Other sectors that are expected to drive high uptake of the leasing product include Oil and Gas, Co-operatives, Manufacturing, Construction, Transport, Mining and ICT.