KA-INVESTOR
Talk of going regional and KCB Group comes first to mind. The rate at which Mr. Martin Oduor is expanding the bank regionally can only be said to be phenomenal. Last week there were opening their fifth outlet in Southern Sudan and sealed a Ksh.38.4 billion ($452 million) mortgage deal with the Government of Southern Sudan. The S&L (KCB’s mortgage subsidiary) deal to finance construction of 1,750 houses for Southern Sudan civil servants is the biggest deal a Kenyan firm has ever got in any of its East Africa subsidiary.
Compared to other indigenous banks, KCB regional expansion strategy/ implementation eclipse them all. And it’s been paying off. KCB's businesses in Tanzania and Southern Sudan have already crossed the profitability threshold, while the one year-old Ugandan subsidiary is likely to break even this year.
A look at the Groups 2008 financials indicates that KCB Uganda assets grew to Ksh.2.4 billion after operating for a year, with its banks loan portfolio, reaching Ksh.660 million, while deposits grew to Ksh.1.48 billion. KCB Sudan returned a pre-tax profit of Ksh.530 million while KCB Tanzania, which reached a breakeven point last year, recorded a pre-tax profit of ksh.32 million.
In Kigali Rwanda, KCB is also the first to be cross-listed (listed) on the Rwanda's Stocks Exchange. This would see KCB’s stocks trade in four securities markets in East Africa; Nairobi, Kampala, Dar-es-Salam and Kigali.
The bank further plan to open 30 additional branches in Kenya and 20 more in Sudan, Tanzania and Uganda. Other Kenyan banks that have ventured into the larger Eastern Africa region include Equity (Uganda); NIC (Tanzania); and DTB (Kampala/ Dar)
Notice that most of these banks have shied away from Ethiopia and Somali (for security reasons: but isn’t the piracy money worth the risk). For Ethiopia I’m yet to understand why Kenyan banks don’t even mention their intentions to go there, probably due to the big government there. But I can bet KCB Group will be the first to set office there.
*Opinion*
From a personal experience with KCB’s below par service, my opinion is skewed towards investing in the banks stocks and not considering to be their client (unless you travel a lot across Kenya or East Africa)
