Chief Executive Officer Albert Ruturi said that since shareholders have upped their stake, earlier plans to list will not be followed through/CFM
NAIROBI, Kenya, Jun 26 – K-Rep Bank has suspended efforts to be listed on the Nairobi Securities Exchange (NSE) after its shareholders increased their stake by a massive Sh600 million.
The bank was expected to list in the equities market two years ago but was pegged back by one of the highest losses in corporate Kenya, reporting an estimated Sh400 million in losses after it converted into a commercial bank.
Chief Executive Officer Albert Ruturi said that since shareholders have upped their stake, earlier plans to list will not be followed through.
“Capital rising is not a possibility right now because shareholders managed to increased their money in a recapitalisation plan,” he said in Nairobi when the bank unveiled its new corporate identity that seeks to position K-Rep as the financial institution of choice for small and micro entrepreneurs.
The identity change will also allow the bank to provide the usual conventional banking services, including further investment in the use of Information and Communication Technology (ICT) and a culture change among staff as it seeks to position itself to compete.
“We think that at Sh1.3 billion, we are adequately capitalised and well positioned to deliver banking and micro-finance products,” he told the function held in Nairobi.
As of last year, the bank’s total assets increased from Sh7.6 billion to Sh9.3 billion in 2011, with customer loans growing to Sh6.7 billion by the end of 2011.
Liabilities also increased from Sh6.5 billion in 2010 to Sh7.99 billion during the same period.
A key aspect of the banks growth is the increase in its profit after tax that shifted upwards to Sh173 million in 2011 compared to Sh51 million in the previous year.
Among other shareholders, the re-capitalising opened the way for the World Bank, through its private arm the International Finance Corporation (IFC), to increase its stake to 15.2 percent.
The bank has also secured a five year term €7 million loan facility from the European Investment Bank (EIB) under the East African Community Cotonou partnership, that allows for onward lending to the micro finance, retail and Small and Medium Enterprise businesses.
Ruturi revealed that the bank further expects to receive an estimated Sh1 billion from the Kenyan government during the current financial year, with the funds being disbursed under the Youth Fund Enterprise Programme.
The bank has also restructured its operations in line with the new brand identity by introducing agency banking, money gram and providing the enhancement of mobile banking services.
