Egypt’s second largest bank, Banque Misr, has announced plans to enter the Kenyan market as it seeks lending deals in East Africa and serving Egyptian firms operating in the region.
The state-run bank plans to borrow Sh25.2 billion ($250 million) from international lenders this year to fund the Kenya expansion which will also coincide with planned entry into Djibouti and Somalia.
“We are in talks with two international institutions on loans with competitive interest rates,” the bank’s chairman Mohamed Eletreby was quoted saying on Monday.
The bank which has branches in the UAE and France, as well as units in Lebanon and Germany, and representative offices in China, Russia, South Korea and Italy could enter Kenya via setting up branches or representative offices, Mr Eletreby added.
The Banque Misr announcement marks the latest declaration of interest by an Egyptian lender to enter Kenya’s 40-plus bank market.
Egypt’s largest private lender disclosed last year it is planning to buy a controlling stake in Kenya’s Tier III Mayfair Bank in a transaction that is set to intensify deal-making in the local banking sector.
Commercial International Bank (CIB) will buy a stake in the three-year-old Kenyan bank as the launch pad for a piece of the East African banking market.
Both banks reckon they will ride on the billions of dollar flows in annual trade between Egypt and Kenya to gain market share, a pointer that it targeting trade finance.
Kenya has witnessed renewed interest by global banks, since the CBK lifted a licensing moratorium in March 2017.
They include America’s largest bank JPMorgan Chase & Co, which said earlier it was mulling over a Kenya entry.
One of Russia’s largest privately-owned banks, Promsvyazbank, also announced in August 2017 it would seek a piece of the pie.
The banking sector is expected to see mergers and acquisitions of third-tier lenders in the wake of the stiffer regulation, Genghis Capital researchers projected earlier.