Tanzania is the cash cow for Kenyan Banks

Equity Bank to hold investment forum in UK

The Tanzanian market has emerged as most favourable for subsidiaries of Kenyan banks in East Africa, accounting for 35.1 per cent of the total profits drawn from their regional presence.

The latest Central Bank of Kenya Banking Surveillance Report shows that the subsidiaries in Rwanda accounted for 21.29 per cent of the total profits while those in Uganda accounted for 12.64 per cent of the $1.45 billion profits Kenyan banks posted last year.

In 2015, subsidiaries operating in South Sudan accounted for one-third of the profits, but political instability has affected the country’s business potential.

The report also shows that the gross loans of the Kenyan banks’ regional subsidiaries grew to $2.31 billion, compared with $1.95 billion the previous year.

The subsidiaries operating in Tanzania had the highest loan amount, accounting for 36.52 per cent of the total loans. They were followed by the subsidiaries in Uganda at 18.31 per cent, while Rwanda subsidiaries issued 16.77 per cent of these loans.

The gross deposits stood at $3.32 billion, compared with $3.31 billion the previous year.

Deposit concentration But, despite the subsidiaries operating in Tanzania having the highest deposit concentration, accounting for 30.79 per cent of the total, their contribution dropped by two per cent, compared with 2015.Uganda was second, with 18.31 per cent of the total deposits, which reflected a drop from 25.2 per cent in 2015.”Three of the subsidiaries registered losses before tax. Out of the loss-making subsidiaries, two were operating in Uganda — indicating presence of stiff competition and market dominance.

Full article at allafrica.com

Leave a Reply

*