I&M shareholders approve buyout of Ugandan bank


I&M shareholders approve buyout of Ugandan bank
PHOTO | COURTESY

In Summary

  • The nod supported by 100 percent of shareholders paves the way for the lender to further its reach in the region pending the receipt of additional approvals from regulators.
  • The acquisition is set to bulk I&M's presence in the region from which it has operations in Rwanda, Tanzania and Mauritius in addition to its home country Kenya.
  • I&M will be joining the likes of DTB, Equity and KCB Group which have presence in the country.
   

I&M Holdings Plc has obtained shareholders’ approval to acquire a 90 per cent controlling stake in Orient Bank Limited, Uganda.

The nod supported by 100 percent of shareholders paves the way for the lender to further its reach in the region pending the receipt of additional approvals from regulators.

Earlier in July, I&M indicated plans to acquire a majority stake in the bank for a deal presently estimated at Ksh.3.6 billion.

The acquisition is set to bulk I&M’s presence in the region from which it has operations in Rwanda, Tanzania and Mauritius in addition to its home country Kenya.

I&M will be joining the likes of DTB, Equity and KCB Group which have presence in the country.

Like other banks however, growth for I&M has been impacted by an uncertain macro-economic environment following the outbreak of the COVID-19 pandemic.

Subsequently, the lender has issued a profit warning on expected earnings to December 31 indicating its earnings will be significantly lower than those booked over the same period in 2019.

The Group has indicated it is taking a number of initiatives to mitigate the adverse impact of the pandemic including a switch to digital channels, deferment of non-critical initiatives and cost containment measures.

I&M profit across nine months to September this year fell by 14.8 per cent to Ksh.4.6 billion from Ksh.5.4 billion on higher loan-loss provisioning costs which topped Ksh.1.9 billion in the period.

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