CBA Group chairman Desterio Oyatsi. PHOTO | FILE
Summary
- The tier two bank, which is associated with the Kenyatta family, gained a foothold in Rwanda by taking over of branches belonging to the fallen Uganda lender.
- CBA’s significant investment in Rwanda includes the undisclosed purchase price, regulator fees as well as the cost of setting up a new branch at Kigali Heights shopping complex.
- CBA outbid rivals to purchase the Crane Bank Rwanda branches that had been taken over by Dfcu Bank, another Ugandan lender.
The Commercial Bank of Africa (CBA) has spent nearly Sh1 billion
on acquisition of the Rwandese subsidiary of Uganda’s Crane Bank.
The
Kenyan lender launched its Rwanda operations on Monday, revealing that
it spent Sh969 million to operationalise the new unit.
The
tier two bank, which is associated with the Kenyatta family, gained a
foothold in Rwanda by taking over of branches belonging to the fallen
Uganda lender.
CBA’s significant investment in Rwanda
includes the undisclosed purchase price, regulator fees as well as the
cost of setting up a new branch at Kigali Heights shopping complex and
refurbishing two others that belonged to Crane Bank.
“So far we have invested at least $9.5 million in Rwanda and
expect to grow this over time as we expand our business in the country,”
CBA Group chairman Desterio Oyatsi said Monday night in Rwanda.
CBA outbid rivals to purchase the Crane Bank Rwanda branches that had been taken over by Dfcu Bank, another Ugandan lender.
The
Bank of Uganda in October 2016 took over the management of Crane Bank —
at the time the country’s fourth-largest — due to under-capitalisation
and sold it to Dfcu.
CBA’s acquisition of Dfcu Bank’s
assets in Rwanda, which was completed last month, saved the Kenyan
lender from the lengthy process of starting a greenfield operation as a
commercial bank in the neighbouring country.
The
lender’s expansion to Rwanda, where it has a staff complement of 35,
brings to five the number of countries where it has a physical banking
presence. CBA also operates 33 branches in Kenya, 11 in Tanzania and two
in Uganda.
CBA first entered Rwanda in 2016 when it
launched MoCash, the equivalent of its highly successful mobile banking
service M-Shwari using a microfinance licence.
CBA is also targeting to expand to Mozambique, DRC and Ethiopia through an online presence.
CBA is also targeting to expand to Mozambique, DRC and Ethiopia through an online presence.
Regional
expansion is becoming important as the East Africa Community (EAC)
common market continues to take shape, opening the way for free movement
of factors of production in a market of over 130 million people.
“This
investment in Rwanda is a key pillar in the implementation of our
group’s vision to be a respected and significant financial services
business partner in Africa,” said Mr Oyatsi.
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