As of December 31, 2022, the combined pre-tax profit of regional subsidiaries of Kenyan banks reached Sh32.51 billion, marking an 88.65 percent increase from Sh.17.23 billion reported on December 31, 2021.
The CBK highlighted that Rwanda contributed the most to these earnings, with profits amounting to Sh.10.16 billion. This figure represents 31.26 percent of the total profits. Meanwhile, subsidiaries operating in the Democratic Republic of Congo (DRC) and Uganda contributed 30.10 percent and 16.11 percent of the total profits, respectively. Subsidiaries in South Sudan also played a significant role, contributing 14.28 percent of the total profits.
In recent years, numerous Kenyan banks, including KCB Group, Diamond Trust Bank, NCBA, Guaranty Trust Bank Kenya Limited, Equity Group, I&M Holdings Plc, African Banking Corporation Limited, and the Co-operative Bank of Kenya, have expanded their operations within the East African Community (EAC) partner states. They have also ventured into markets such as Mauritius, Malawi, and Mozambique.
Some Kenyan lenders, like I&M and Prime Bank Limited, have even expanded beyond the EAC jurisdiction. For example, I&M holds a 50 percent share in Bank One Limited in Mauritius, while Prime Bank has a 10.6 percent share in First Capital Bank Malawi, a 6.62 percent share in First Capital Bank of Botswana, and a 5.0 percent share in First Capital Bank SA, Mozambique.
The CBK report revealed that Kenyan bank subsidiaries operating in Mauritius, Tanzania, and Burundi were the least profitable, contributing 4.50 percent, 2.82 percent, and 0.93 percent of the total profits, respectively. Furthermore, three subsidiaries experienced a combined loss of Sh2.4 billion, with two operating in Tanzania and one in Uganda, according to the regulator.
As of December 31, 2022, the total assets of Kenyan bank subsidiaries abroad amounted to Sh1.61 trillion, compared to Sh1.21 trillion the previous year. Equity Group Plc’s subsidiary in the DRC, Banque Commerciale Du Congo (BCDC), played a significant role in the asset base, with total assets of Sh442 billion. KCB Group Plc’s subsidiary in the DRC, Trust Merchant Bank, also made a substantial contribution, with total assets of Sh212 billion.
Regarding deposits, Kenyan bank subsidiaries accounted for a combined deposit base of Sh1.28 trillion in December 2022, compared to Sh940 billion in December 2021. The primary contributors to these deposits were Equity’s subsidiary in the DRC, Banque Commerciale Du Congo (BCDC), which accounted for Sh365 billion or 28 percent of the total deposits in host countries, and KCB Group’s subsidiary in the DR Congo, Trust Merchant Bank, which accounted for Sh180 billion or 14 percent of the total deposits in host countries.
As of December 31, 2022, the combined gross loans for subsidiaries in host countries reached Sh725.8 billion, reflecting a 42.2 percent increase from Sh510.3 billion in the previous year. Among the subsidiaries, those operating in the DRC recorded the highest level of gross loans, amounting to Sh.244.5 billion, which accounted for 33.69 percent of the gross loans in all subsidiaries outside Kenya. Subsidiaries in Tanzania accounted for 20.
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