KCB Joins Equity in Scramble for DRC

The Democratic Republic of Congo (DRC) is fast shaping up to be the new frontier for Kenya’s financial giants. First, it was Equity banking on the country to overtake Kenya  as its largest market by 2025.

Now, KCB Group is mulling plans for a major entry into DRC. CEO Joshua Oigara offered the hint on Wednesday, March 16 when the bank announced a 74% year-on-year increase in net profit which hit Ksh34.2 billion in 2021.

While discussing growth prospects and the economy across East Africa, he also highlighted the group’s recent investments in Rwanda where the group completed the acquisition of Rwanda’s second largest bank, Banque Populaire du Rwanda Plc (BPR), to merge with KCB Rwanda.

“However, we do have some investment projects that we are looking at [including] the consolidation of the bank in Rwanda and we also have conversation today about our potential entry into DRC,” Oigara stated.

In February 2021, Equity Group Holdings unveiled its new identity in DRC, Equity BCDC, after completing the acquisition of Equity Bank Congo (EBC) and Banque Commerciale du Congo (BCDC).

President Uhuru Kenyatta was present for the launch of their shiny new Kinshasa headquarters, and Equity has also been organizing trade missions involving business and government leaders in both countries to spur trade and investment.

Equity’s CEO Dr. James Mwangi believes DRC will likely overtake Kenya as Equity’s largest market by 2025.

“DRC business will fundamentally change Equity Group. DRC at the moment contributes 27 percent of the group balance sheet and is growing at about 60 percent annually and may overtake Kenya between the third and fifth year,” he observed in 2021. He further described it as ‘a juggler pipe that will change this group forever’.

Like Equity, KCB will be thinking about how to get in the front seat of driving financial inclusion in the populous nation. They are boosted by the confidence drawn from growing regional subsidiaries.

“The benefits of our regional expansion continue to positively contribute to the KCB’s performance. In 2021, the profit before-tax contribution from Group businesses went up to 13.7%, putting us on track towards our 20% target this year. KCB will continue exploring and pursuing attractive regional expansion opportunities to enhance our regional participation, accelerate growth, and maintain sustainable long-term performance,” KCB Group Chairman Andrew Wambari Kairu noted.

“Our future has additional opportunities to exploit, details of which will be communicated as they develop,” he added.

Most recently, Equity and KCB were in a race to cross Ksh1 trillion in assets on their balance sheets.

KCB Group was the second local bank to achieve the feat after Equity Group. The lender crossed the threshold in the quarter ending June 2021 when its total assets hit Ksh1.022 trillion.

KCB also voiced confidence on regional expansion opportunities with one eye on the growing economies.

“We are optimistic about the East African economy’s inherent medium and long-term potential despite the looming effects of the geopolitical crįsis in Europe, lurking threats of COVID-19 and other local developments, including the upcoming General Elections in Kenya.”

“The priority is to identify suitable investment prospects and consumption drivers to accelerate the pace of recovery and growth. As the growth gains momentum, it will lead to many more opportunities for all sectors of the economy and in turn, inclusive growth,” Kairu stated.