The Rwandese banking unit is now the second most profitable subsidiary for KCB after its Kenyan operating unit having booked a pre-tax profit of Ksh.1.5 billion in six months to June.
The acquisition of BPR last year by KCB, which created a merged entity known as BPR Bank Rwanda Plc, added Ksh.51 billion to KCB’s balance sheet in the six months of operations.
The unit’s performance in the period has overtaken that of KCB’s last acquisition in the form of the National Bank of Kenya (NBK) whose pre-tax profit stood at a lower Ksh.964.1 million in the period.
During the period since acquisition, KCB Group has rolled out a number of intervention to bolster the unit including migrating customers on smart switch card holders to Visa debit cards.
At the same time, KCB has undertaken to recover loan defaults in the unit to achieve a lower 4.5 per cent non-performing loans (NPL) ratio from 7.6 per cent while reaching a cost to income ratio of 59 per cent from 64 per cent.
“I have told NBK that they need to watch out. There is nothing I can do despite having been their MD. BPR is firing,” said KCB Group Managing Director and CEO Paul Russo.
KCB is now backing the Rwandese unit scaled asset base of Ksh.84 billion to grow BPR’s income stream and act as a springboard to facilitate the growth of business opportunities in the DRC.
Having recently reached a binding agreement to buy a controlling stake in DRC’s Trade Merchant Bank (TMB), Paul Russo expects the Group to witness growth in trading income even as it looks to regain pole position as the region’s and Kenya’s largest bank by asset base.
“The naysayers will begin to see real transformation and delivery in Rwanda. We want to be number 1.5 by the end of the year, and by next year, number one should begin feeling the pressure,” added Mr. Russo.
KCB has subsidiaries in other markets including Burundi, Rwanda, Tanzania and South Sudan.
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