I&M Group is seeking to recapitalise its Ugandan unit by injecting Ush30 billion ($7.89 million) to shore up its lending business and comply with the Bank of Uganda’s new capital requirements.
The lender also looks to expanding its footprint in the Democratic Republic of Congo (DRC), the large market of which lenders across the region are scrambling to serve.
The fresh capital injection, which is to be executed within the next six months, will push I&M Bank Uganda’s core capital to Ush150 billion ($39.47 million) by June 2024 allowing the subsidiary to boost its lending activities, translating to more interest income to the bank and dividends to shareholders.
The lender listed on the Nairobi Securities Exchange (NSE) is seeking to strengthen its corporate business as well as deepen its inroads into the Small and Medium-Sized Enterprises (SMEs) and retail space in the Ugandan market.
“Uganda is a market where you see some significant increases in capital from the regulator. So, obviously, we have put our capital plans in line with them (statutory capital requirements) but at the time of acquisition we were already aware,” the group’s regional chief executive Kihara Maina said on December 18.
Source: theeastafrican
