NAIROBI, Kenya, Jan 21-HF Group has signed a deal with Britam Holdings that will see the Group receive Sh1 billion tier 2 capital injection as part of the broader strategy to power growth and cement its full-service banking strategy.
HF Group CEO Robert Kibaara said the funds will help accelerate the bank’s operations boosting SME lending while also allowing the bank to leverage its mortgage leadership by intensifying end user mortgage finance specifically to the affordable housing segment.
“The investment comes on the back of a turnaround strategy that is poised to see the business transform into a full service bank. This is indeed a major vote of confidence informed by the results already being witnessed through our business transformation initiatives,” said Kibaara.
The SME sector which contributes 30percent of Kenya’s Gross Domestic Product (GDP) is a key focus for HF Group with the Group CEO noting the funds will further the bank’s mission of empowering entrepreneurs through trade financing, working capital, and other short-term facilities to spur the sector.
“Investing in SMEs is a powerful mechanism through which we can deliver impact at scale,’’ Kibaara added.
The Group has diversified into new business segments such as SME Banking, Diaspora Banking and Personal Banking.
Over that period, customer deposits have grown by 3.8 billion while interest expense has reduced by Sh1billion.
Customer numbers have grown by 25 percent on the back of a robust digital banking platform and diversified product offering.
Britam Holdings Chief Executive Officer Benson Wairegi said, “Our support will allow the bank to grow its full-service banking offering, deepen penetration of banking services and promote financial inclusion for all. This demonstrates our confidence in the transformation strategy of HF Group.”
The funding will also boost HF Group’s strategy focusing on end-user financing for affordable housing and creating opportunities for Kenyans in the middle-income bracket to own homes.
The Group has also signed agreements with the National Government to finance buyers of Park Road affordable housing project and private sector developers, including real estate developer Tecnofin Limited, which is developing 1,562 affordable housing units in Pangani.