The landmark deal which will be disbursed in two tranches over a period of 12 months seeks to support Bank of Africa’s foray into the retail market segment.
Speaking during the signing ceremony in Nairobi, Bank of Africa Kenya Chairman Dennis Awori said the loan comes at an opportune time when the bank is actively introducing new products for the retail market, with five products being launched recently.
“The banking industry in Kenya is experiencing interesting times when financial access is on the increase through the many banking institutions. Bank of Africa Kenya will utilise the loan to finance medium and long term loans for eligible customers,” Awori added.
FMO, the Dutch Development Finance Company is an institutional partner at Bank of Africa Kenya, holding a 20 percent share in the bank.
“At FMO, we have a strong belief in the power of entrepreneurship in economic development and therefore support sustainable private sector growth in emerging markets. The loan will be payable in seven years from the date of signing the facility agreement,” Jorim Schraven, FMO Manager, Financial Institutions for Africa commented.
Schraven said FMO is confident in the bank’s ability to steer business in the right direction where good corporate governance increases investor confidence which is important in an increasingly integrated world.
“BOA Kenya is continuously improving its services to meet customer needs, while following market trends very closely. We have expanded our network to 27 branches in Kenya with a strategic plan to add five branches this year. This will help us serve our growing portfolio of customers better, as we work towards meeting the Vision 2030 goal to create a globally competitive and prosperous country. We are very optimistic about Kenya’s economic and social development,” the bank’s Managing Director Kwame Ahadzi said.
The loan facility offers BOA Kenya long-term capital that will lead to a broader lending platform.