Co-operative Bank of Kenya's joint leasing venture with South African logistics firm Super Group has concluded a major deal to supply 125 police vehicles worth over Sh890 million.
The deal is phase one of a plan to provide about 412 trucks to the Kenya Police worth Sh2.2 billion in the current fiscal year, whose negotiations we reported last October.
Co-op Bank confirmed Wednesday in a statement that its recently-established joint venture leasing firm known as Co-op Bank Fleet Africa Leasing Ltd had inked a deal with Fleet Africa, which is Super Group's regional arm, to provide government with 125 vehicles.
"This maiden transaction, which is part of a larger Sh2.2 billion deal, entails the financing and delivery of a fleet of 125 vehicles to the Ministry of Interior, the National Police Service and the Prisons Department," said Co-op Bank.
Co-op Bank is the financier, with Co-op Bank Fleet arranging the leasing in collaboration with motor vehicle franchise Isuzu East Africa Ltd who are to deliver the fleet comprising trucks, pickups and buses.
"Super Group Ltd is an established global leader in leasing business operating in three continents and is listed on the Johannesburg and Sydney stock exchanges. This partnership between Co-op Bank and Super Group is mutually beneficial as it taps the synergies created by the joint venture," said Co-op Bank group managing director Gideon Muriuki.
President Uhuru Kenyatta's move to turn to vehicle leasing to boost the capacity of the police service and other agencies has come as a boon for leasing firms, financiers and auto dealers.
"This is a big milestone in ensuring police mobility and safety in their duties," Mr Kenyatta said in Nairobi in 2017.
Analysts say Co-op Bank's entry into the fast-growing business will help it leverage the SA firm's expertise and experience to take the competition to local rivals.
Stung by the interest rate controlling regime that took effect in 2016, Kenyan financiers are now casting nets wider.