26/02/2019 by ThinkBusiness 0 Comments
BOA Kenya is now focusing on returns rather than market share.
Bank of Africa is a subsidiary of Morocco's BMCE Bank. BCME holds 75 percent of the group. BMCE is the second largest bank in Morocco with a total asset of $ 20 billion and over 650 branches in Morocco. It also has ...
Bank of Africa is a subsidiary of Morocco's BMCE Bank. BCME holds 75 per cent of the group. BMCE is the second largest bank in Morocco with a total asset of $ 20 billion and over 650 branches in Morocco. It also has about 14 per cent market share in Morocco both in banking and also involved in Bancassurance. BMCE is owned by Finansco Group and CIC a French bank. BMCE owns Bank of Africa Group (BOA). BOA Group has a shareholding of 80 per cent in BOA Kenya Limited. BOA Group has subsidiaries in 17 countries in Africa including; Benin, Madagascar, Côte d’Ivoire, DRC and Djibouti.
BOA Kenya has been in Kenya since 2004. It has presence in all East African country and a representative office in Ethiopia. “This means we are ready to enter the Ethiopian market as soon as it opens up to foreign banks. We have 30 branches in Kenya, 32 In Uganda we have and 25 in Tanzania. We are quite spread in these markets.” Notes Ronald Marambii Managing Director Bank of Africa Kenya Ltd “2017 was a very challenging year for the whole industry because, we had just implemented the interest rate cap which was signed into law in September 2016, at the same time, private sector credit growth was very low at 4 percent and had signs of growing lower. 2017 was an election year, usually, election years slow down the economy. The presidential election of US had just finalized with Trump coming in. There were many uncertainties coming from that and also IFRS 9 the new accounting reporting standards mean to be implemented in January 2018.” He elaborates.
Mr. Marambii reveals that they resorted to shrink their balance sheet and reduce expensive deposits because there was nothing much they could do with them. “Our balance sheet shrunk but there was more efficiency. We saved a lot on interest expense, and we were also able to reduce our risky assets.” He says. They went ahead to close bank branches that were not contributing positively to the bank. But still were able to serve our clients through technology. They managed staff by having voluntary early retirement package offered where 45 staff volunteered for early retirement. Their staff numbers currently range between 421 and 425.