Spire Bank to invest in low cost housing in 35-acre Juja land

July 12, 2016
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Speaking to Capital FM Business the banks’ Chief Executive Tim Gitonga says the investment will be made on a 35-acre piece of land in Juja in partnership with Mwalimu Asset Managers/COURTESY
Speaking to Capital FM Business the banks’ Chief Executive Tim Gitonga says the investment will be made on a 35-acre piece of land in Juja in partnership with Mwalimu Asset Managers/COURTESY

, NAIROBI, Kenya, Jul 12 – Spire Bank plans to invest in low cost housing in part of its strategic plan for the Kenyan market.

Speaking to Capital FM Business the banks’ Chief Executive Tim Gitonga says the investment will be made on a 35-acre piece of land in Juja in partnership with Mwalimu Asset Managers.

The firm which was formerly known as Equatorial Commercial Bank was acquired by Mwalimu Teachers Sacco who has already injected Sh1 billion capital in the beginning of the year.

Gitonga says the bank; together with Mwalimu Asset Managers are doing preliminary research to find out the cost implications of the project that is expected to start in 2017.

Apart from low cost housing, the lender also intends to focus on Small and Medium Enterprises planning to invest Sh5 billion on this class this year.

This plan is intended to increase its SME portfolio from the current 45 percent of its business to 65 percent in the next two years.

“Among the issues affecting the SME sector include performance risk issues, where SMEs do not deliver to the specifications of their contracts and payments become an issue, we are seeking to do capacity building on them so as to help be the best they can be,” Gitonga observed.

He said the real issue with cost of credit comes from the escalating Non Performing Loans.

“If we all paid our loans, I’m sure interest rates that have been spoken about for so long would go down, Integrity is such a big issue in the country today, that has to be looked at,” he added.

On regional expansion, the firm intends to first invest in strengthening their brand in the Kenyan market for the next five years but eyes Ethiopia.

“We are also open to discussions on mergers and Investments from international firms seeking to invest in the country, adequate capital is always welcome,” Gitonga pointed out commenting on the consolidation wave the banking sector is currently experiencing.

The tier bank is a medium-sized financial institution in Kenya, serving corporate clients, small and medium enterprises and individuals.
Spire has set its sights on achieving Tier 2 status within the next four years.

As of December 2013, the bank’s total assets were valued at about Sh15.5 billion, with shareholders’ equity valued at about Sh1.371 billion.

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