Equity DRC Might Overtake the Kenyan Unit

Equity Bank Chief Executive Officer (CEO) James Mwangi has confirmed that DRC will start rivalling Kenya in terms of profit rise and balance sheet size and may overtake Kenya between the third and fifth year.

The CEO states that DRC has made them a top market in financial services; both in the balance sheet, profitability, and customer base.

According to the CEO, the DRC business will essentially change Equity Group as it already contributes 27 per cent of the group balance sheet and is growing at a 60 per cent rate annually.

“Given the momentum of growth in DRC, the possibility of standing out and becoming more attractive is certain. Equity should now be trading at the same rate as Capitec Bank of South Africa,” he said.

Mr Mwangi also confirmed that 49 per cent of their balance sheet is in dollars as this makes it easy to deploy the resources within the group and exploit the cross-border transactions’ internal funding opportunity.

He added that they are strengthening their credit management by putting up the credit function and creating a position for Chief Credit Officer.

“The Chief Credit Officer’s role is to lead credit underwriting and credit administration within the group to intensify credit monitoring and relevant credit collection,” the CEO added.

In response to a question whether he saw green shoots with a liquidity ratio of 60.6 percent despite the required 60. He said that the unit, “has a liquid balance sheet with Sh 500 billion of cash, cash equivalents, and government securities.”

“We believe lessons have been learned about global supply chains in manufacturing and many will be seeking to set up regional and national supply chains to avoid disruptions like the Covid-19 multi crisis”.He added.

Equity was the most profitable bank last year and has also led in Q1 2021 with a 64 percent growth in net profit to Sh 8.7 billion.

By Philly Opere