Fintech Branch International acquires Kenya’s lender Century Microfinance Bank

KENYA – Fintech Branch International, has acquired microfinance lender Century Microfinance Bank in a move that gives the financial technology firm a stronger presence in Kenya’s financial sector.

According to regulatory filings published by the Competition Authority of Kenya (CAK), Branch has acquired 84.89 per cent of the issued share capital in the microfinance bank.

The deal has been approved by the market regulator.

“The Competition Authority has authorised the proposed transaction as set out herein on condition that the acquirer and the target will each maintain the terms agreed with the borrowers in respect of all loans existing in their loan books at the time of the acquisition,” explained CAK in a notice in the Kenya Gazette.

The deal will further give Century Microfinance Bank a much-needed lifeline, coming in the wake of depressed earnings due to disruption from digital lenders and recently, the Covid-19 pandemic.

According to Central Bank of Kenya (CBK) data, the micro-lender recorded US$3.3 million in assets as of the end of December 2019, a 19 per cent drop from US$4.1 million in 2018.

The firm also recorded US$3.1 million in liabilities for the year ended December 2019 with customer deposits sitting at US$2.4 million during the period under review.

The lender made US$774,086 in total income in 2019, the majority of it from interest on loans, fees and commissions.

Brach International, one of the leading fintech players in the Kenyan market has over the years increased its user base across the region to more than three million.

The firm says it has disbursed more than US$330.4 million in loans, the majority of which it lent to users in its African markets in Kenya, Nigeria and Tanzania.

In 2019, Branch secured US$160.6 million in the new financing and a partnership with Visa to issue virtual pre-paid debit cards to its users.

The acquisition of Century Microfinance Bank will allow the fintech firm to deploy more solutions to grow its digital and physical foothold in the Kenyan market.

The acquisition of Century Microfinance Bank will allow the fintech firm to deploy more solutions to grow its digital and physical foothold in the Kenyan market.

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