Norwegian joint venture buys 12% stake in Equity Bank

Two Norwegian investment firms have acquired a major stake in Equity Bank by purchasing half of the shares held by Helios Investment partners. Norfund and NorFinance AS – a joint venture investment company between Norfund and Norwegian private investors – have purchased Helios Investment Partners’ 12.223% in Equity Group Holdings Ltd, according to a statement from the bank.

Equity Group CEO James Mwangi said the transaction, the largest of its kind in Sub Saharan Africa and which is awaiting regulatory approvals, brings will diversify Equity Group’s capital base.

“Norfund and NorFinance share Equity’s core values of partnership, promoting financial inclusion and strong corporate governance. We are proud to have played a role in the bank’s growth and success to date, and look forward to continuing to partner with Equity in the next phase of its development and to support its direct positive impact on the lives of people in the communities within which it operates,” said Mr Babatunde Soyoye, Managing Partner of Helios.

Equity is one of the biggest banks in East Africa with nearly 10 million customer accounts and about $4 billion (Ksh340bn) in assets. It has subsidiaries across the region  that provide banking, insurance agency, investment banking, securities brokerage and information and telecommunications technology outsourcing services.

Mr Kjell Roland, Managing Director of Norfund, said Equity is an attractive business with a strong global management team and an established track record within the banking industry. He said the investment is strongly in line with Norfund’s strategy to support banks targeting entry level and mass-market retail banking, and SMEs. Equity profit after tax has grown in excess of 30% between 2007 to 2013.

Over this period, the bank has expanded its business and customer segments to become fully inclusive, and extended its operations regionally into Uganda, Tanzania, Rwanda and South Sudan. Equity has recently embarked on a new phase of development, under a corporate growth strategy entitled “Equity 3.0’’, to expand its business.