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ABC Bank sponsors Catholic Education Commission conference- 8th March, 2016

ABC Bank has sponsored this Catholic Private Schools Education Conference held at the Catholic University from 8th to 11th March. The bank sponsored the event to the tune of Ksh. 250,000 in support of the church’s efforts in improving educational standards in the country.

The conference has brought together about 600 delegates representing Catholic educational institutions across the country. ABC Bank utilized the opportunity to reach out to the church-run schools to provide them with various financial services and instruments such as asset financing, mortgage financing among others.

While presenting the sponsorship cheque, Head of Retail banking Amanda Corline lauded the church for its role in the educational sector in the country for over a century.

“ABC Bank recognizes the need for the private sector to participate in enhancing access to quality education for the Kenyan child, and we support the efforts by the Catholic Church in this direction”, noted Amanda.

ABC Bank continues to invest in key areas of need among Kenyan communities- health, education, humanitarian and development.

Bible Society of Kenya

ABC Bank boosts Bible Society of Kenya’s children program – 4th March, 2016

The Bible Society of Kenya has benefited from a donation by ABC Bank in support of its Children’s Program.

The bank donated Ksh. 100,000 to the society to go towards enhancing its Children’s Outreach Program activities. The program focuses on character formation and equipping pre-teens and teenagers with necessary life skills.

The donation is part of ABC Bank’s corporate social responsibility initiatives, which includes supporting social causes in communities where it operates in.

Speaking during the cheque presentation ceremony at the Bible Society of Kenya offices in Nairobi, Head of Retail Banking Amanda Corline said the bank is committed to supporting social causes that have a significant and direct impact on communities.

Bingwa Sacco partnership launch

ABC Bank partners with Bingwa Sacco to expand footprint- 19th February, 2016

ABC Bank has signed an agency banking partnership with Kirinyaga-based Bingwa Sacco as part of its strategy to reach more customers and enhance its service offering.

Through the agreement, ABC Bank customers can now access financial services at any of the 18 Bingwa Sacco branches.

The agency banking model is increasingly answering the call for deepened financial access in Kenya as commercial banks continue to sign up agents to reach more customers through cost-effective non-traditional banking channels.

“Through this banking arrangement, we are able to reach more customers who can now access our services from more locations where we are not physically present’’, said ABC Bank’s Group General Manager, Peter Kinyanjui.

Mr. Kinyanjui added: ‘‘we do not view Saccos as competition, but as partners with whom we work together to ensure they meet the increasingly changing demands of their customers and optimize their input in the economy. This is also an opportunity for ABC Bank to bring our services closer to more Kenyans to connect them with the country’s financial system for greater convenience.’’

ABC Bank has over the last four years aggressively pursued strategic partnerships with Saccos to enable them offer a wider range of services to their members. This is in line with the ABC Bank‘s efforts to boost the cooperative sector’s competitive advantage to best achieve their business goals, and to offer a seamless, convenient and comprehensive financial services experience to their members.

Bingwa Sacc0 Chairman Cyrus Kabira lauded the agreement between the two institutions, saying it will give the Sacco an opportunity to extend its efficient services to Kirinyaga County people.

“Bingwa Sacco will be collecting the county revenues in all its 18 branches and 10 mobile units which are well spread within the county.  This will go a long way in the growth of Kirinyaga County,” noted Bingwa Sacco Chief Executive Officer Jane Mugo.


ABC Bank supports improvement of Catholic Church health facilities- 14th February, 2016

ABC Bank has donated Sh.250,000 in support of health facilities under the Catholic Church. Presenting the donation to the Kenya Conference of Catholic Bishops, Head of Retail Banking Amanda Corline said the bank is committed to plugging the gap in health care by supplementing the public sector efforts by partnering with the private sector.

The funds will go towards the improvement of health facilities under the Catholic Church.

Chinese New Year 2016

ABC Bank hosts Chinese New Year celebrations- 6th February, 2016

ABC Bank hosted the Chinese community living in Kenya as they ushered in their new year at the Villa Rosa Kempinski. The event was organized by Guangdong Association, an umbrella body of Chinese business people in Kenya.

The Chinese New Year begins on 8th February, and is the Year of the Monkey, the ninth animal in the cycle. The next Year of the Monkey will be in 2028. Each Chinese New Year is characterised by one of 12 animals which appear in the Chinese zodiac. The Chinese zodiac is divided into 12 blocks (or houses) just like its western counterpart, but with the major difference being that each house has a time-length of one year instead of one month.

ABC Bank utilized the opportunity to engage the growing Chinese community in Kenya, with a view to cultivating mutually beneficial partnerships.

CBK issues additional guidelines on large cash transactions- 18th January, 2016

Bank customers are now required to declare names of beneficiaries of cash withdrawals above Sh1 million and justify why such large transactions cannot be done using electronic transfer channels. This is according to additional prudential guidelines issued to all banks by the Central Bank of Kenya (CBK) in a circular dated 5th January 2016.

The new guidelines, which took effect immediately, require that all bank customers making cash (over the counter) transactions of USD 10,000 and above or its equivalent in any currency to fill a Large Cash Transaction Declaration form declaring:

  • The source of the money being deposited or withdrawn over the counter
  • Why the large cash deposit or withdrawal is necessary
  • Why the cash deposit or withdrawal cannot be made through electronic means
  • Where the money will be taken right from the bank premises
  • What the money is going to be used for
  • The full identity of the direct or indirect beneficiaries of the money

The introduction of this new regulation aims to reduce the risks associated with cash transactions and encourage the use of electronic payments which are a more secure alternative channel to process payments.

They are also meant to fight flow of graft funds—usually transmitted in cash to avoid tracing and evade tax – through the banking and micro-banking system.

For more information or queries, please email us on or call 0701 700 700.

EIB 2015

ABC Bank gets Ksh. 554.8 M credit line from European Investment Bank- 11th December, 2015

ABC Bank and the European Investment bank have signed a Ksh. 554.8 million (Eur 5M) for onward lending to Kenyan small and medium enterprises (SMEs). The credit line from EIB is a top up of a previous Ksh. 770 million that ABC Bank received in 2012, which made ABC Bank the first local bank to enter in to a credit line agreement with the world’s largest international public bank to ease credit access for small and medium enterprises.

The agreement is part of EIB’s plans to provide Ksh 12 billion (EUR 110 million) for investment by SMEs across East Africa, making it the largest ever financial support for entrepreneurs in East Africa by the EU owned bank in the region.

ABC Bank will utilize the new facility to support growth in the SME and Agribusiness segments, which are instrumental in job creation and economic growth in Kenya by providing long-term and affordable credit.

The new programme will support job creation and economic growth in Kenya, Tanzania, Uganda and Burundi by providing long-term local and foreign currency loans and support investment across a range of sectors, including agriculture.

“We have effectively utilized the earlier facility in lending to our SME clients at competitive rates and for longer tenures. As a result, we have witnessed exponential growth in our customers’ businesses, which is in line with our mission of empowering customers to achieve the extra-ordinary’’, said ABC Bank Group Managing Director Shamaz Savani, adding that the new deal is a demonstration of the confidence that EIB has in ABC Bank, and that it will bolster the Kenyan lender’s capacity to continue lending to the SME segment to empower them to harness their market potential and contribute to the national economy.

ABC Bank has invested in the development of tailor-made products and increased its lending portfolio for the growing SME sector, which is crucial in enhancing entrepreneurship, economic growth, market competition, economy-wide efficiency, innovation and aggregate productivity as well as providing the economy with a continuous supply of ideas, skills, and innovations.

“Investment by small companies and entrepreneurs is essential for economic growth and to create jobs. The European Investment Bank is pleased to strengthen our support to ensure that East African companies can unlock new business opportunities and build on previous successful engagement with leading local banks. Since the EIB’s regional office for East and Central Africa opened 10 years ago professionalism and enthusiasm of the Nairobi based team has strengthened our support for entrepreneurs and small business across the region.” said Pim van Ballekom, European Investment Bank Vice President.

Mr. Savani added: We are delighted by the new credit line, which comes at an opportune time when there is increased need for financing, especially within the SME and Agribusiness segments, which have in recent times become a key drivers of Kenya’s economy. We are confident that access to affordable financing through ABC Bank, thanks to this facility from EIB, will further unlock the entrepreneurial potential in the country and thus generate more job opportunities and aid in wealth creation.

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ABC Bank launches money remittance service to India – 20th November, 2015

ABC Bank has launched a money remittance solution to facilitate fast, secure and cost-efficient money transfers from Kenya to India. This is part of the bank’s strategy to grow its reach in to new frontiers.

The new solution, dubbed iRem, enables ABC Bank customers and non-customers alike to make person-to-person, business-to-business and business-to-customer funds transfer in the Indian currency, Rupee, at competitive forex rates. Funds are remitted efficiently and promptly since the service is connected to SWIFT (Society for Worldwide Interbank Financial Telecommunication) which provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardized and reliable environment.

ABC Bank is seeking to tap in to the increasing trade between the two countries, which saw India’s exports in to Kenya grow to USD 4,118 billion (Ksh. 42.7 trillion) in the financial year 2014/15, according to India’s High Commission in Kenya website. There are also many investment partnerships between Kenya and India.

Besides the large population of Asian Kenyans, there is an increasingly large number of Indians living and working in Kenya. Additionally, over 18,000 Kenyans are issued with visas to study and work in India.

“Essentially, the remittances between the two countries are increasing in direct proportion to the growing socio-economic activity between them, hence the need for reliable and cost effective funds transfer solutions”, said ABC Banks’ Group General Manager, Peter Kinyanjui.

The new product- iRem- is an addition to the bouquet of local and international money transfer services that ABC Bank has rolled out in the last couple of years to facilitate a seamless financial interconnectivity of people in different parts of the world.

Kinyanjui added: This product is more than a remittance solution; it will further catalyze the entrepreneurial acumen and prop up the social support system of the Indian communities in both countries.

ABC Bank maintains stable credit rating- 29th October, 2015

The Global Credit Rating Company (GCR) has upheld last year’s ABC Bank upgraded rating of national scale short term A2 (KE) and long term BBB (KE) with the outlook accorded as Stable.

An A2 rating, according to Fitch Ratings, is a very high credit quality rating and denotes expectations of very low default risk. It indicates a very strong capacity for payment of financial commitments not significantly vulnerable to foreseeable events. On the other hand, a ‘BBB’ rating is good credit quality and indicates default risk is currently low, with adequate capacity for payment of financial commitments.

The favourable rating comes on the back of the bank’s improved capitalization, enhanced risk management process, sufficient liquidity buffers and moderate earnings profile. Other factors leading to the rating include the bank’s focus on its leading position in providing affordable trade and asset financing products to the vibrant SME and corporate segments, as well as its expansion of client portfolio to include all market segments. The bank has in the last couple of years made a concerted effort to tap in to the local and international remittances segment even as inflows from the Diaspora community continue to increase.

“We are energized by the positive rating. It positions us as having safe and sound financial health backed by our capital raising efforts through the private bond issue last year’’, noted ABC Bank Group Managing Director Shamaz Savani.

The bank issued a Ksh.1 billion private bond in May 2014 to raise additional capital following revised Central Bank of Kenya prudential guidelines in 2013 requiring banks to maintain a higher capital conservation buffer. The issue was oversubscribed by 57 percent following huge investor enthusiasm. As a result of the cash call, ABC Bank grew its total regulatory capital by 57.2 per cent from 2013 to Ksh. 2.9 billion in 2014, driven by an increase in retained earnings.

In spite of a higher absorption of funds to support lending to SME and corporate clients, the bank’s liquidity ratio has remained solid and in line with the regulatory requirements. The bank also took a strategic decision to maintain the liquidity ratio at a low of 25 percent and a high of 32 percent to optimize fund utilization and grow the loan portfolio.

Savani added: “The positive rating status is a reflection of the deliberate steps we have taken in effecting positive operational changes in the business, including the enhanced funding profile and positive internal growth. We have appropriately deployed funding, improved profitability while maintaining credit protection factors and diversified our income streams.”

In an effort to bolster its delivery channels, ABC Bank has invested in innovation to increase its customer touch points. It has partnered with 15 Saccos across the country to provide current accounts and trade finance facilities to their members. It also entered in to an agency banking agreement with Postbank last year to support its retail outreach strategy.

ABC Bank’s strength is also anchored on its market diversification through its subsidiaries- Nairobi-based stock brokerage ABC Capital, ABC Insurance Brokers and ABC Capital Bank-Uganda.

“Plans to roll out new branches in prime locations in Nairobi are at an advanced stage. These will, besides expanding our presence, take our services closer to our increasingly growing clientele base as Nairobi continues to grow as a regional business hub,” Savani hinted.

Central Bank of Kenya Press Release on Imperial Bank Limited (In Receivership) – October 27, 2015

The Central Bank of Kenya (CBK) received a report on the state of financial affairs of Imperial Bank Ltd. (In Receivership) from the Kenya Deposit Insurance Corporation (KDIC). This follows KDIC’s appointment by CBK as receiver for Imperial Bank Limited (IBL) on October 13, 2015, according to the provisions of the Banking Act and of the Kenya Deposit Insurance Act. The appointment of KDIC as a receiver for IBL was done in the interest of IBL’s depositors, creditors, and members of the public.

CBK has reviewed the report, which confirms fraudulent activities of substantial magnitude, and the misrepresentation of IBL’s financial statements. These activities relate largely to irregular granting of loans by IBL’s management, contrary to the legal and regulatory requirements, and the internal policies of IBL. In particular, these irregular loans were a violation of the statutory limit of lending to a single borrower, and inadequate loan loss provisions, thereby overstating IBL’s capital adequacy position.

The fraudulent activities have resulted in a significant shortfall in IBL’s capital position. Nevertheless, CBK and KDIC consider IBL to be viable and have examined options that will lead to the prompt reopening of the bank. These options require the shareholders to inject new capital to meet the identified capital shortfall. The ultimate objective is to ensure that the reopened bank will remain viable.

CBK and KDIC met today with the bank’s shareholders and presented a proposal that will enable reopening of the bank and a resumption of operations. The proposal will require the injection of new capital, conversion of some of the large deposits to equity, recovery and collateralization of the fraudulent loans, as well as a change of Board of directors and senior management. The proposal envisages full access to small deposits, and a structured schedule of repayment to large depositors. CBK expressed its expectation that an agreement with shareholders should be reached enabling the bank to reopen in a month’s time.Shareholders appreciated the proposal and expressed their strong commitment to reopen the bank quickly. Shareholders requested to consider the proposal over the next few days and to come back with an implementation plan for the way forward. In parallel, CBK and KDIC will on Wednesday, October 28, 2015, meet some representatives from a cross-section of IBL’s depositors to brief them on these developments.

In the meantime, steps are being taken to facilitate the recovery of the funds that were obtained irregularly from IBL. A forensic audit and other investigations are also ongoing on the culpability of these fraudulent activities.

CBK and KDIC will continue to work closely with IBL’s shareholders and all concerned parties to facilitate an expeditious resolution. CBK and KDIC will communicate further as the way forward is clarified.


October 27, 2015