CONGO – Equity Group Holdings Limited, one of the largest financial institutions in East Africa has announced that it will pay Sh10.7 billion (US$105 million) to the wealthy George Arthur Forrest family for its 66.5 percent stake in Banque Commerciale du Congo (BCDC)

Equity which already has a subsidiary in DR Congo, aquired in 2015, revealed that it will seek to integrate the two banks in a merger that will create the second largest bank in the Central African nation.

The bank also revealed that it would acquire an additional 7.6 percent stake from KfW – a German State-owned development bank, pushing its ownership in Equity Bank Congo to 93.6 percent.

“By acquiring BCDC and the KfW stake in EBC, Equity will expand its footprint in DRC,” the bank said in a statement.

“This is an opportunity for the group to take further steps towards the delivery of its vision of building sub-Saharan Africa’s premier financial institution.”

DR Congo is one of the biggest countries on the continent by land mass and has more than 80 million people, making it appealing to ambitious lenders looking for growth in the continent.

The financial market in DRC is mainly focused on serving big companies with operations there, making it necessary to have a big balance sheet to be able to compete and grow, said analyst and Business Daily columnist George Bodo.

The merger of the bank and Equity’s DR Congo subsidiary will create a lender with assets of more than Sh100 billion (about US$983 million) making it the second largest bank in DRC after Rawbank.

Equity entered DR Congo in 2015 through acquisition of ProCredit Bank and the business has overtaken the Uganda unit to become the most profitable subsidiary for the Kenyan bank.

Equity’s DR Congo subsidiary’s net profit grew 140 percent to Ksh 700 million (US$6.88 million) in the year to December. The group’s net profit last year stood at Sh11 billion (US$108 million).

The bank has been stepping up its expansion in Africa through acquisitions and has bolstered its African presence by announcing the purchase of shares in banks in Rwanda, Zambia, Mozambique and Tanzania.

Equity also bought the assets of London-listed financial services firm Atlas Mara, further underlying its deal-making appetite.

Besides DR Congo, Equity Bank also has subsidiaries in South Sudan, Tanzania and Rwanda, and mainly targets the lower-income segment of the market.