African banks including Egypt’s Commercial International Bank, Nigeria’s Access Bank and South Africa’s Nedbank are seeking to expand in Kenya, but competition from the country’s entrenched domestic lenders is limiting their returns.
Kenya’s appeal lies in its gateway role to the East African Community, a fast‑growing bloc expanding by at least 5% a year.
“It becomes hugely, hugely attractive,” said Kenny Fihla, Chief Executive Officer of South Africa’s Absa Bank which said last week it is increasing its stake in its Kenyan business to as much as 85% through a tender offer.
African banks have been busy dealmaking as global giants such as Standard Chartered and Society General exit smaller markets to focus on core ones such as Kenya, while a growing need to invest in technology has prompted deals to gain scale.
However, it takes time to achieve growth in Kenya’s crowded banking sector, which central bank data showed produced some $2 billion in annual pretax profit in 2024, as incumbents including Equity Group and KCB Group leverage large customer bases, regional reach and strong mobile platforms.
–Reuters–
