Equity Is Bullish on Congo as CEO Sees Economic Growth Surging

NAIROBI (Capital Markets in Africa) – Equity Group Holdings Ltd., Kenya’s biggest lender by market value, expects the balance sheet of its operations in the Democratic Republic of Congo to almost double this year as economic growth accelerates.

Since acquiring ProCredit Bank Congo SA in 2015, Equity has grown the unit’s value to 60 billion shillings ($594 million) from 15 billion shillings, Chief Executive Officer James Mwangi told reporters Tuesday in the Kenyan capital, Nairobi. That figure is expected to grow to 100 billion shillings this year, equivalent to about 25 percent of its Kenyan balance sheet, he said.

The average growth rate in Congo was 3.2 percent over the past three years, less than half the rate of the preceding five years, International Monetary Fund data shows, after a slump in commodity prices curbed export income. The country, the world’s largest source of cobalt and Africa’s biggest producer of copper and tin, is also stabilizing after a contentious election period in December, Mwangi said.

“The market had overpriced the risk in Congo,” he said. “Commodity prices have jumped back and economic performance has increased quickly from 1.8 percent three years ago to 3.9 percent. And after the election, we hope it will go back to the 8 to 13 percent range where it was before the slump in commodity prices.”

Equity earlier announced a 4.8 percent increase in full-year profit to 19.8 billion shillings, helped by a 10 percent rise in the amount of income it earned on loans, according to a statement.

Source: Bloomberg Business News