Salaam African Bank, the leading bank by branch network in Djibouti, has acquired 100% ownership in Kenya’s Uwezo Microfinance Bank, giving the lender a presence in Kenya’s banking industry. The acquisition took effect on March 25, 2021, after obtaining approval from the Central Bank of Kenya and the Cabinet Secretary for the National Treasury and Planning.
In a public notice issued by CBK, the authority said,
“This follows CBK’s approval on December 24, 2020, under Section 19(4) of the Microfinance Act and approval by the Cabinet Secretary for the National Treasury and Planning on January 12, 2021, pursuant to Section 19(3)(b) of the Microfinance Act.” CBK in a public notice
Salaam African Bank, one of the three Islamic banks in Djibouti, was established in 2007 and is licensed and regulated by the Central Bank of Djibouti.
The bank holds 30 % of the total bank accounts in Djibouti, has the highest number of branches and Automated Teller Machines (ATMs) in Djibouti. SAB has a presence in Ethiopia through a representative office and Kenya through an investment bank licensed by the Capital Markets Authority.
Uwezo MFB is a community microfinance bank that was licensed by CBK on November 8, 2010. The microfinance bank carries out business in the Starehe Division of Nairobi County.
The institution was granted approval to upgrade to a nationwide microfinance bank in December 2015. Uwezo MFB had a market share of 0.45% of the microfinance banking sector and was ranked 10 out of 14 MFBs as of March 31, 2021. It has one branch in Nairobi.
The CBK has expressed confidence in the acquisition, saying it welcomes the transaction, which will strengthen the business model of Uwezo MFB and enhance the resilience of Kenya’s microfinance banking sector.
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