Africa-Press – Uganda. Pan-African banking group United Bank for Africa (UBA) has acquired more stakes in its Ugandan and Kenyan subsidiaries as the Nigerian lender seeks to penetrate the East African banking market.
The Nigerian billionaire Tony Elumelu-owned lender acquired 11 percent and 13 percent additional shares in UBA Uganda and UBA Kenya respectively in 2022.
The increase signals UBA’s growing appetite in East Africa, which has a market potential of more than 300 million people. It also runs subsidiaries in Tanzania and DR Congo.
In details contained in UBA Plc’s 2023 annual report, the lender indicated that in 2022, it had increased its shareholding in the Ugandan unit to 80 percent from 69 percent, while in Kenya its stake had risen from 81 to 94 percent.
The additional stakes in the two units were collectively acquired at $16.04m (Shs61b), comprising a payment of $6.03m (Shs22.9b) for the 11 percent stake in the Ugandan subsidiary and $9.99m (Shs38b) for the 13 percent stake in the Kenyan unit.
In addition to the share purchase, UBA Plc further injected $15.02m (Shs57.2b) of additional capital in the two subsidiaries in 2023, which included $4.45m (Shs16.9b) and $10.55m (Shs40.1b) worth of additional investments in Kenya and Uganda, respectively.
UBA’s units in Kenya and Uganda opened in 2009 and 2008 respectively.
The Ugandan subsidiary made a net profit of $2.68m (Shs10.2b), from a net loss of $728,869 (Shs2.7b) in the period ended December 2023, while in Kenya the subsidiary narrowed its losses to $991,318 (Shs3.7b) in 2023 from a net loss of $1.44m (Shs5.48b) in 2022.
In Tanzania, UBA’s net profit increased to $1.85m (Shs7b) from $187,423 (Shs713m) in 2022, while in DR Congo net profit increased to $3.74m (Shs14.2b) from $229,941 (Shs875m.
Three Nigerian banks have set a foothold in East Africa, including Access Bank Plc, which in 2020 more than doubled its stake in its Rwandan subsidiary after acquiring Kenya’s Transnational Bank, and Guaranty Trust Bank.
Access Bank now owns a 75 percent shareholding in the Rwandan subsidiary.
Guaranty Trust Bank acquired 70 percent shareholding in Kenyan-owned Fina Bank Group in 2013.
New acquisition
Nigeria’s Access Plc disclosed in January that it had acquired an 80 percent stake in Finance Trust Bank, in a transaction that would be closed in the first half of this year.
The lender made another acquisition by taking over the National Bank of Kenya, a subsidiary of KCB Group.
For More News And Analysis About Uganda Follow Africa-Press
