IFC acquires 6.7% shares in Equity Group worth Ksh.13.9 billion, 2nd largest shareholder
The International Finance Corporation (IFC) has acquired a 6.7 percent stake in Equity Group to become the lender’s second-largest shareholder.
The stake is equivalent to Ksh.13.9 billion, bought from Britam Holdings in April.
“As Equity Group, we are delighted to welcome IFC, a member of the World Bank Group to the Equity family as our second-largest shareholder,” said Equity Group CEO and Managing Director Dr. James Mwangi.
This is IFC’s first investment in Africa that aligns with the corporation’s approach to increase green equity investments in financial institutions.
IFC’s foot in Equity Bank will see small businesses majorly involved in climate-smart businesses on the continent benefit from Ksh.19.1 billion it has pumped into the bank in a financing deal which was signed Tuesday.
Dr. Mwangi has agreed to allocate Ksh.9.2 billion (US$.80 million) equity towards climate-related interventions covering all subsidiaries over the next five years.
It means Equity Bank will not fund any utility company that generates more than 20 percent of energy or revenues from coal, or have an annual coal production of 10 million tonnes or more, or have an installed coal-fired capacity of 5,000 megawatts or more.
Bamburi Cement is among the major manufacturers that use coal to fuel production.
According to Equity, the monies will support at least 5 million MSMEs and 25 million households through the creation of over 50 million jobs both directly and indirectly.
Bank’s Top Shareholders
Equity Bank’s top shareholder is African investment company Arise B.V. (main shareholder), backed by institutional investors Norfund, FMO and Rabobank, is the top shareholder with an 11.99 percent stake.
Others are Stanbic Nominees Limited with a 3.9 percent stake followed by Dr. James Mwangi with 3.38 percent.
At the end of 2019, Equity Bank, with a balance sheet size worth Ksh.673.7 billion was listed number seven among the top 10 Banks in Africa in 2020 with a score of 5.82 in the overall category of the best performing banks.
The Banker Top 1000 World Banks 2020 ranked Equity Bank 754 in balance sheet size overall in its global ranking, 62nd in soundness (Capital Assets to Assets ratio), 55th in terms of Profits on Capital and 20th on Return on Assets.