Equity Group Profit 2019 and Equity Bank CEO Dr James Mwangi www.businesstoday.co.ke
Equity Group Limited Managing Director James Mwangi. Equity Group's profit for the nine months ended September 30 have fallen by Sh2.5 billion.

Equity Group on Tuesday announced that it has shelved plans to expand across East Africa by backing out of negotiations to acquire Atlas Mara’s (ATMA) banking businesses in Rwanda, Tanzania, Zambia, and Mozambique.

According to Equity, the decision has been informed by the uncertainty of risk which precipitated the proposed withdrawal of Ksh9.5 billion dividend pay-out to shareholders.

In January 2020, the board announced the extension of discussions with ATMA following the expiry of the transaction period before the two parties could sign a detailed transaction agreement.

During the extended period, the two parties would continue further discussions to try and reach mutually acceptable commercial terms with respect to the proposed transaction or a variant of it.

Speaking while announcing the board’s decision, Equity Group CEO Dr. James Mwangi said the board has considered the events that have taken place since January when the two parties agreed to extend transaction discussions and particularly the impact of the COVID-19 p******c to the world and the economies in which Equity operates.

“After careful consideration, EGH and ATMA have mutually agreed to discontinue discussions on the transaction for the foreseeable future,” said Dr. Mwangi in a press dispatch.

Further, according to Dr. Mwangi, the board’s decision is in line with its business continuity management that speaks to risk assessment, approach to prudent risk mitigation and management in the prevailing economic slowdown occasioned by the COVID-19 p******c in the region and globally.

“The Board’s Business Continuity Management is focused on conserving cash and liquidity and deploying it to support our customers to survive during this economic c****s and to recover and thrive post the c****s. A strong capital and liquidity position gives us the strength and capacity to cushion our business, accommodate, and walk with our customers during these challenging times,” said Dr. Mwangi.

“We have deployed a defensive and offensive mechanism through loan accommodations and rescheduling/restructuring of up to 25% of the total loan book for periods of up to 36 months. This will enable our customers to go through the prevailing turbulence, while at the same time preserving cash to shore up the financial revival and growth of their businesses post the COVID-19 c****s,” he added.

Equity has stepped up the push to digital channels and growing the various non-funded income franchises while re-evaluating the acquisition of new businesses where significant capital injection and managerial attention is required.

Dr. Mwangi concluded by saying that, “The Group is committed to its strategic objective of expanding its footprint in Africa to provide access to competitive, tailored financial services to improve people’s lives and livelihoods whilst also delivering significant value to its stakeholders.

At the same time, the Group continues with its vision of building sub-Saharan Africa’s premier financial institution through delivering innovative products and services to customers including, in particular, the effective use of technology self-service banking.

See Also>>> Kenya Should Tread Carefully on Trade Deal With the US

LEAVE A REPLY

Please enter your comment!
Please enter your name here