Francis Ayieko
24 August 2008
Nairobi — Keen on increasing its visibility and customer base, Kenya-based Fina Bank has launched a regional expansion blitz that will see it open several new branches in Kenya, start operations in Uganda and relocate its Rwanda branches to better sites.
However, the bank says it has no plans to enter Tanzania and Burundi -- the other two partners in the five-member East African Community -- in the near future.
According to the managing director, Frank Griffiths, the bank, which mainly targets the small and medium enterprises segment, will have opened 12 new branches in Kenya by the end of the year. The first of the envisaged new branches was opened about two months ago on Thika Road in the Muthaiga area.
Its Uganda operations, which have been on the cards for more than a year now, are set to start mid next month with five new branches.
It is currently relocating three of its five branches in Kigali, Rwanda, to renovated buildings along major roads in Kigali where they will be more visible.
The move is part of Fina's repositioning strategy in Rwanda where it acquired a state-owned bank and its branches in 2004. They will now be located in modernised buildings.
The new branches, according to Mr Griffiths, will be established where small and medium enterprises are concentrated in keeping with the bank's focus on serving small and medium businesses in East Africa.
"Our focus is to be the SME bank of choice in East Africa. We now want to be more visible to attract more customers and hence more deposits," Mr Griffiths told The EastAfrican in an interview recently.
In Kenya, where it currently has eight branches, the bank plans to open new branches in small and middle income towns of Thika and Nanyuki. In Nairobi, it will open branches in Gikomba and on Ngong Road.
"In all these places, we see a lot of untapped business," said Mr Griffiths.
Five of its eight Kenya branches are in Nairobi; Mombasa, Nakuru and Eldoret.
The bank had planned to start opening new branches in Kenya late last year but was forced to briefly shelve the plans due to the rising political heat generated by election campaigns in December and the subsequent eruption of violence between December 2007 and January this year.
Because it is hardly known in Uganda, the bank plans to inaugurate its operations with more than one branch to emphasise its presence there.
"In Uganda, we have been trying to buy something but we have failed. So we are going to open four branches from scratch," Mr Griffiths says of Fina Bank's efforts to buy out another bank in Uganda last year.
He confirmed that their operations in Uganda would start next month. The bank has already identified the buildings where the branches will be located and is currently recruiting senior level staff.
He also disclosed that the bank is considering adding two new branches in Rwanda, but he could not say by when. After setting up shop in Uganda, Fina will target Tanzania and Burundi in the hunt for a regional presence.
"Our aim is to facilitate trade between these countries," Robert Warlow, the group chief operating officer was quoted as saying recently.
Mr Warlow said the bank's entry into the Ugandan market works well with their regional plan.
"It is just the right time in our strategy, and development of the bank. We have a clear vision of being a regional bank and Uganda plays an important role in that."
But Mr Griffiths said they will carry out "cautious expansion" because of the "uncertain business environment" in the region.
"Our aim is to be the SME bank of choice in the East African Community. But we are not in a rush to enter Burundi and Tanzania. We want to first get Uganda up and running then we will see what to do with Tanzania and Burundi," he said.
It is understood that Fina is facing increasing pressure from some of its customers doing business in Uganda, Rwanda and Kenya, to expand in their markets.
Once it opens its doors, Fina will be the third foreign African bank to start operating in Uganda after Kenya Commercial Bank and United Bank for Africa of Nigeria.
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