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Equity Bank biggest beneficiary of World Bank’s Sh111.7bn Kenyan portfolio

Equity Bank takes the biggest share of the World Bank’s Sh111.7bn Kenyan investment 31 Kenyan firms.

The International Finance Corporation invested Sh111.7 billion in 31 Kenyan companies, with Equity Bank receiving the largest share of that investment—nearly 40% of the portfolio in the nation.

According to a World Bank Group report, the International Finance Corporation (IFC) had given Equity Sh42 billion by April of last year, the majority of which was invested in quasi-equity, a hybrid financial product that combines aspects of both loan and equity investments.

The IFC, the private investment arm of the World Bank Group that focuses on the private sector in emerging markets, gave the most money to banks.

Co-operative Bank came in second place on a list that also included companies from the agribusiness, energy, real estate, insurance, and manufacturing industries, with an outstanding balance of Sh15 billion.

To increase its capital buffers, the international financier gave KCB Kenya Sh13.9 billion, DTB Kenya Sh6.7 billion, and I&M (Sh6.2 billion).

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According to the information provided in the World Bank Group’s Country Partnership Framework (CPF) for the Period FY23-FY28, banks accounted for the majority of the IFC’s overall investment in Kenya as of June of last year, or close to 77.5 percent, or Sh86.6 billion.

IFC has grown to be the largest lender to local banks, who use the money to increase their capital and increase lending in areas that are important to the international financier, such as women-owned businesses and climate-friendly initiatives.

The IFC loans support the local banks’ ability to raise money for future loans to small enterprises, with a sizable amount coming in when the Covid-19 outbreak hit Kenya in March 2020.

“IFC investments cut across the financial, manufacturing, agribusiness and services, and infrastructure sectors. It maintains a rich advisory services program covering renewable energy, trade and competitiveness, public-private partnerships, access to finance, and corporate governance,” said the World Bank in the CPF.

Other huge beneficiaries of IFC’s financing, whose sole objective is to help emerging countries transition into market economies, include National Cement (Sh4.6 billion) and Britam Holdings (Sh3.4 billion).

Canadian-based oil and company, Africa Oil Corp, has also received Sh3.4 billion in equity from IFC. Small lender GTB Kenya received Sh1.8 billion.

Agri-tech firms Twiga Foods and Thika Power have each received Sh1.4 billion while Bidco Africa Limited has received Sh1.3 billion.

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