Equity Group, KCB Secure DRC Banking Rule Exemptions, Retain Stakes in Subsidiaries
Read Time:2 Minute, 23 Second
Equity Group and KCB have secured DRC Banking Rule Exemptions, allowing both lenders to retain their controlling stakes in their Democratic Republic of Congo (DRC) subsidiaries.
The exemption spares the two Kenyan lenders from complying with the DRC’s “Instruction 18,” which would have compelled foreign-owned banks to dilute their shareholding to at least 45% local ownership by the end of 2026, with four unrelated shareholders each holding a minimum of 15%.
The decision allows Equity Group to maintain its 85.4% stake in EquityBCDC and KCB Bank to keep its 85% stake in Trust Merchant Bank (TMB). Both banks had faced the possibility of multi-billion-shilling divestments after regulators initially signaled that compliance would be enforced within months.
Equity Group CEO James Mwangi said the DRC Senate had “yielded” to the group’s petition, removing the threat of a forced stake reduction.
The ownership rule, introduced by the Banque Centrale du Congo (BCC), aimed to diversify bank ownership and boost Congolese participation.
On May 27, 2025, Equity Group submitted a formal memorandum through the Association Congolaise des Banques (ACB) to the DRC parliament, requesting that listed banks such as itself and KCB be exempted from the requirements. The lender described the absence of a provision for listed entities as a regulatory oversight.
- What Drove Equity Group’s Strongest Quarter in History
- Why Equity Group’s Insurance Arm Could Be Its Next Big Profit Engine
Equity Group entered the DRC in 2015 by acquiring an 86.6% stake in ProCredit Bank Congo, later renamed Equity Bank Congo, and expanded further in 2020 with the acquisition of 66.53% of Banque Commerciale du Congo (BCDC) for USD 95 million from the George Arthur Forrest family.
The merger created EquityBCDC, now the second-largest bank in the DRC, with total assets of Sh656.5 billion, over 1.3 million accounts, and 74 branches as of 2024.
Equity Group increased its stake in EquityBCDC to 85.4% in 2023 after purchasing an additional 6.6% for about Sh9.24 billion, valuing the subsidiary at roughly Sh140 billion. A compelled 30% sale could have been worth about Sh42 billion.
KCB Group’s expansion into the DRC came in August 2022 when it signed a definitive agreement to acquire an 85% stake in TMB, one of the country’s largest banks. Established in 2004, TMB has a strong presence in retail, SME, corporate, and digital banking.
The deal, valued at between Ksh15 billion and Ksh20 billion, received approvals from regulators in Kenya, the DRC, and the COMESA Competition Commission, closing in December 2022.
KCB retained the TMB brand to leverage its local expertise and extensive branch network to enhance digital capabilities, trade finance, and cross-border trade opportunities.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.
Happy
0 %
Sad
0 %
Excited
0 %
Sleepy
0 %
Angry
0 %
Surprise
0 %
0
0
Average Rating