Business & Money
Britam Holdings Posts Record Profit, Boosts Market Position
By Q4 2024, Britam aims to finalize its strategic entry into the DRC market through the acquisition of a local insurer. This initiative is part of the company’s larger goal to establish a strong presence in 12 African countries by 2030.
:Britam Holdings Plc has achieved record profits and strategically expanded into the DRC, showcasing resilience and adaptability in Africa’s financial landscape. With diverse revenue streams and a clear growth vision, Britam aims to enhance stakeholder value and strengthen its position as a leading pan-African financial services provider.
By Charles Wachira
Integrated financial services firm, Britam Holdings Plc announced in late March 2024 a remarkable KSh 4.82 billion ( US$ 37,302,587) profit before tax for the year ended December 31, 2023. This represents a significant 65% increase from the KSh 2.92 billion ( US$ 22,598,247) recorded in the previous financial year ended December 31, 2022.
Financial Performance
The robust financial performance is attributed to substantial growth in top-line revenue from both insurance and investment activities, which effectively cushioned the business against fair value losses incurred from fixed income securities. Britam’s insurance revenue surged to KSh 36.4 billion, marking a notable 41% increase from KSh 25.8 billion in 2022. The general insurance business throughout the region and the Kenyan insurance sector, which together accounted for 29% of the total insurance revenue, both saw notable expansion that drove this growth.
SWOT Analysis
Strengths:
- Strong Financial Performance: Britam’s KSh 4.82 billion profit before tax for 2023 demonstrates a solid financial foundation and effective revenue generation strategies.
- Diversified Revenue Streams: Growth in both insurance and investment activities reduces reliance on any single income source, providing stability against market volatility.
- Regional Expansion: Successful expansion into the DRC and other East African markets strengthens Britam’s presence and market share in the region.
Weaknesses:
- Exposure to Market Volatility: Despite growth, Britam still faces risks associated with fair value losses in fixed income securities.
- Operational Risks in New Markets: Entering new markets like the DRC poses operational challenges and regulatory risks that could impact profitability.
Opportunities:
- Untapped Markets: The DRC presents significant growth potential with low insurance penetration rates, offering Britam a chance to capture a large market share.
- Digital Transformation: Continued investment in digital solutions can enhance customer experience, improve operational efficiency, and drive further growth.
- Strategic Acquisitions: Acquiring established local insurers in new markets can accelerate market entry and expansion.
Threats:
- Regulatory Changes: New regulations in various markets could impact operational processes and profitability.
- Economic Instability: Economic fluctuations in target markets could affect consumer spending on insurance products.
- Competitive Pressure: Increased competition from other financial services providers in the region could impact market share and profitability.
Strategic Initiatives and Future Outlook
By Q4 2024, Britam plans to have completed its strategic entry into the DRC market by acquiring a local insurer. This move aligns with the company’s broader plan to establish a significant presence in 12 African countries by 2030. The acquisition, valued at approximately USD 50 million, is expected to boost Britam’s gross earned premiums by 15% annually over the next five years, with the DRC operations contributing an estimated KSh 5 billion by 2028.
Britam’s proactive expansion strategy, coupled with its commitment to innovation and customer-centric solutions, positions it well for sustainable growth. The company plans to invest over USD 200 million in acquisitions and organic growth initiatives across the continent over the next six years.
Conclusion
Britam Holdings Plc’s record profit and strategic expansion into the DRC underscore its resilience and adaptability in the dynamic African financial landscape. With strong financial performance, diversified revenue streams, and a clear vision for future growth, Britam is well-positioned to enhance value creation for its stakeholders and strengthen its presence in Africa’s emerging markets.
Keywords:Profit Growth:Market Expansion:Insurance Revenue:Strategic Acquisitions
Financial Performance
: KCB Group reports Sh44.5B ( US$ 342.31) nine-month profit, outpacing
Equity Bank. Learn about its 49% growth, challenges, and stock performance this
year.
KCB Group Plc has outperformed Equity Bank to cement its position as Kenya’s leading
lender, posting a net profit of Sh44.5 billion for the nine months ending September
This represents a 49% year-on-year growth, surpassing Equity Bank’s Sh37.5
billion profit during the same period.
Profit Growth Driven by Core Business Performance
The remarkable profit growth was fueled by higher earnings from both interest and non-
interest income streams. KCB’s diverse revenue base has been pivotal in maintaining
its dominance in the competitive banking sector.
Non-Performing Loans a Key Concern
Despite the impressive profit growth, KCB’s non-performing loan (NPL) ratio rose to
18.5%, compared to 16.5% last year. This increase highlights persistent challenges in
managing credit risk, with Chief Financial Officer Lawrence Kimathi acknowledging it as
a “pain point” for the bank.
KCB Stock Outshines Peers on NSE
KCB’s strong financial performance has translated into exceptional stock market results.
The bank’s stock has risen 78.8% year-to-date, making it the best-performing banking
stock on the Nairobi Securities Exchange (NSE).
Plans to Sell National Bank of Kenya
Earlier this year, KCB announced plans to sell its struggling subsidiary, National Bank of
Kenya (NBK), to Nigeria’s Access Bank. While Nigerian regulators have approved the
deal, it is still awaiting clearance from Kenya’s Central Bank. The sale aims to
streamline KCB’s operations and address losses at NBK.
CEO Paul Russo Optimistic About Year-End Performance
“The journey has not been without its hurdles, but our ability to walk alongside our
customers has driven our success,” said KCB CEO Paul Russo. He expressed
confidence in closing the year on a high note, leveraging improving economic conditions
across the region.
Key Figures at a Glance
● Net Profit: Sh44.5 billion (+49%)
● Non-Performing Loan Ratio: 18.5% (up from 16.5%)
● Stock Performance: +78.8% year-to-date
KCB’s strong performance underscores its resilience in navigating challenges and its
commitment to sustaining growth in Kenya’s banking sector.
Business & Money
Top 10 Kenyan banks by total assets as of 2023, based on data from the Central Bank of Kenya:
KCB Bank Kenya Limited
Total Assets: KSh 1.425 trillion
Market Share: 17.4%
Equity Bank Kenya Limited
Total Assets: KSh 1.004 trillion
Market Share: 12.2%
NCBA Bank Kenya PLC
Total Assets: KSh 661.7 billion
Market Share: 9.2%
Co-operative Bank of Kenya
Total Assets: KSh 624.3 billion
Market Share: 8.8%
Absa Bank Kenya PLC
Total Assets: KSh 520.3 billion
Market Share: 6.6%
Standard Chartered Bank Kenya
Total Assets: KSh 429.3 billion
Market Share: 5.9%
Stanbic Bank Kenya
Total Assets: KSh 449.6 billion
Market Share: 5.8%
I&M Bank Limited
Total Assets: KSh 405.6 billion
Market Share: 5.4%
Diamond Trust Bank Kenya
Total Assets: KSh 399.6 billion
Market Share: 5.3%
Bank of Baroda (Kenya) Limited
Total Assets: KSh 201.9 billion
Market Share: 2.8%
These rankings illustrate the dominance of large Tier 1 banks, which collectively control over
76% of the market share. Strategic expansions, increased deposit mobilisation, and robust
lending practices underpin the sector’s strong performance
: Vasundhara Oswal, daughter of industrialist Pankaj Oswal, faces serious
charges in Uganda. The Oswals call for UN intervention amid claims of corporate
jealousy.
Vasundhara Oswal, the 26-year-old daughter of prominent Swiss-Indian industrialist
Pankaj Oswal, has found herself at the centre of a legal storm in Uganda.
Her father, a well-established business figure, is known for his diverse investments,
most notably a $150 million ethanol plant in Uganda.
This plant, the largest of its kind in East Africa, is a key part of Oswal’s broader strategy
to invest in industrial and eco-friendly solutions in the region. The facility produces extra-neutral alcohol (ENA), which is used in the beverage, cosmetics, and pharmaceutical industries.
It is recognised for its modern technology and sustainable practices, such as zero liquid
discharge, emphasising the Oswal family’s commitment to both industrial growth and
environmental responsibility.
In addition to the ethanol plant, Pankaj Oswal has made strategic investments across
various industries, including petrochemicals, agriculture, and real estate.
His ventures reflect a global reach, extending to Australia and India, where he has
been involved in industries ranging from agriculture to renewable energy.
His diversified business approach and commitment to sustainability have made him a prominent figure in international business. However, in October 2024, the family’s legacy was overshadowed by the legal troubles surrounding Vasundhara Oswal.
She was detained on October 1, 2024, after being accused of involvement in the
alleged murder of Mukesh Menaria, a former employee who had worked with the
Oswals since 2017.
Menaria had accused the family of harassment but later testified under oath that they
had not harmed him Despite this, charges of kidnapping and murder were brought against Vasundhara.
Her family has strongly denied these allegations, claiming that the charges are
politically motivated and part of a larger conspiracy orchestrated by their business rivals
in collaboration with corrupt officials in Uganda.
The Oswals have appealed to the United Nations, seeking intervention and asserting
that the legal proceedings against Vasundhara are unlawful. Vasundhara has actively managed the family business throughout her career, especially the ethanol plant, and led the company’s sustainable initiatives.
Beyond her business involvement, she has also been an advocate for community
welfare and mental health, further cementing the Oswal family’s reputation for corporate
social responsibility.
The unfolding legal drama has raised important questions about the intersection of
business, politics, and the legal systems in Uganda.
While the Oswal family’s ventures reflect a blend of industrial innovation and social
responsibility, the legal challenges Vasundhara faces have cast a shadow over their
business empire, highlighting the complex dynamics at play in East Africa.
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