By STANDARD CORRESPONDENT
Nigeria-based United Bank for Africa (UBA) is set to pump over Sh4 billion in the first half of this year in an ambitious expansion plan that will see it move to the profit-making zone.
In nine months to September, the bank posted a $1.1 million loss, which was attributed to huge capital expenditure outlay in setting up operations.
But with the accelerating economic growth, the bank says it will pump over $50 million (Sh4 billion) into its Kenyan operations in the first half of the year.
The funds are expected to cushion the bank against operating losses, finance further expansions and drive it to the profit-making corridor.
"The bank’s performance has been on target and in line with our expectations. Whilst we set ourselves very ambitious targets to break-even within one year, in reality we knew that it was bound to take longer than that, mostly due to costs associated with establishing a solid presence in Kenya," the bank said recently, adding: "We have learned a number of lessons from our experience so far, and intend to capitalise on these in our next growth phase."
Today, the bank has opened more than 15 branches in East Africa, 10 of which are in Uganda, three in Kenya and the remaining in Tanzania. A fourth one is to be opened in Mombasa this quarter.
UBA has also drawn a "comprehensive" plan that will see it facilitate trade with the East African Community in a bid to exploit the opportunities that will come with the creation of a common market last July.
Meanwhile, Manz Denga, the Managing Director of United Bank for Africa (UBA), has ended his career with the institution after the expiry of his contract following an outstanding career spanning almost a decade.
Sources close to the bank told The Standard that veteran banker Binay Dutta has taken over the position in an acting capacity. Denga’s departure comes amid the bank’s planned expansion in East and South African economies.
"The strong foundation I laid in the bank will definitely drive its expansion plans across the continent. UBA has strong systems, wide capital base and appealing products for the market," Mr Denga, who is credited for the bank’s expansion in West and East Africa, said.
It is due to these comparative advantages that UBA is now eyeing a presence in the Democratic Republic of Congo and Congo Brazzaville.
This will bring to 19 the number of countries the bank operates from. With over a year since the bank entered Kenya, critics say the bank’s performance has not been as satisfactory as had earlier been projected.
To boost its operations in the market, UBA recently introduced a money transfer and trade finance service across Africa. The services will allow the bank to reinforce its position as a Pan-African bank seeking to tap into the growing interaction between African countries.
UBA is one of Africa’s leading financial institutions with a customer base of more than seven million customer accounts.
It is not clear where Denga will be heading, but The Standard has learnt that he will be heading to Harvard to further his studies as he speculates venturing in the financial sector in East Africa.