Equity Bank received funding pledges from world-known financiers, namely World Bank private-sector funding arm, IFC, and Agence Française de Dévelopment Group. International Finance Corporation committed to loan Equity Bank $50 million, equivalent to Kshs 5 billion. Proparco, in the partnership deal with Equity bank, pledged $100 million, which is equal to Kshs 10 billion.
For three months up to September, the bank’s borrowing his increased to Kshs 68.5 billion, which is a 19.7% increase. Also, the bank has so far grown its loan book by 30%. This has seen the lender’s net interest income grow to Kshs 39.3 billion.
The lender’s CEO, James Mwangi, said the funding is coming at a crucial time when the bank is looking for low-cost money to grow its loan book. The bank is currently facing high loan default rates, negatively affecting its profits. Therefore, the funding is welcome, and the funds will be loaned to both small and medium-sized businesses and grow its loan book.
Targeted businesses are manufacturing companies for personal protection equipment, online companies, FMCG, agriculture value chain, and logistics. The Lender’s CEO said they are encouraging their customers to diversify their investment and take advantage of the new business opportunities during this COVID-19 pandemic period.