AfrAsia Bank seeks new growth opportunities in SADC countries
According to ABL Mauritius group CEO, James Benoit, AfrAsia is now looking to grow its presence in East Africa through Kenya because the bank has already a stake in South Africa through AfrAsia Zimbabwe Holdings Limited. (Image: Dale Capital)
Mauritius-based banking major AfrAsia has decided to increasingly invest in other Southern African Development Community (SADC) countries, following a rise in the bank’s confidence in regional economies.
After cementing its position in the island economy as a leading financial institution, the banking group is now targeting other African countries, starting with Zimbabwe.
Zimbabwe’s Kingdom AfrAsia Bank received an investment of US$20 million from AfrAsia Bank Ltd (ABL) which will be translated to equity resulting in the banking group acquiring a 62.5% controlling stake in the former Kingdom Bank up from the current 32%. And, considering that the local legal threshold is 49%, it signifies a big vote of confidence in the Mauritian banking major by the government of Zimbabwe.
Further to this investment, Zimbabwe’s Finance Minister Patrick Chinamasa defended the government’s position, saying that the authorities were conscious of what the law required and the dilution that will come with this investment. But, there is some time for the thresholds to be met, since work was still going on to develop a policy framework that would clearly spell out indigenisation thresholds for the economy’s different sectors.
After buying out the group’s founder Nigel Chanakira and renaming it to AfrAsia Zimbabwe Holdings, AfrAsia Bank Mauritius took control of the former Kingdom Financial Holdings last year.
Kingdom Bank was renamed AfrAsia Bank Ltd while Kingdom Asset Management was renamed AfrAsia Capital Management.
It is to be noted that ABL offices are also located in Johannesburg and London.
According to ABL Mauritius group CEO, James Benoit, AfrAsia is now looking to grow its presence in East Africa through Kenya because the bank has already a stake in South Africa through AfrAsia Zimbabwe Holdings Limited.
“With AfrAsia’s growing presence in the region and the increased volume of trade and investments going into Zimbabwe, we are committed to tap into the African market, which is instrumental in our plans to further identify and enhance the untapped synergies in the SADC region” said Benoit.
James Benoit explained that Zimbabwe was chosen because it figures among the top 10 growing African economies and there are opportunities for developing further as Zimbabwe is a resource-rich country where there is a strong entrepreneurial culture.
“Our presence in this country will definitely enhance our banking adeptness in other parts of the region, enabling the AfrAsia Group to take advantage of existing and new growth opportunities in its key market segments,” he said.
He added that their presence in Zimbabwe will help them to expand their franchise in the SADC region through an established local operation and with highly credible local partners.
James Benoit highlighted that AfrAsia’s profits for the 2013 financial year increased by 68% in Mauritian rupees, while deposits were 39% higher and that the banking group will maintain its efforts to sustain these growth rates for the present financial year in the markets it operates.
“We are excited and quite optimistic of a brighter future for Zimbabwe and we will keep our stakeholders updated of any material developments within the Group,” he said.
ABL was established in Mauritius seven years ago to benefit from the growing trade between Asia and Africa.