• Home
  • Business
  • Kenya: NCBA finalizes acquisition of AIG Insurance

Kenya: NCBA finalizes acquisition of AIG Insurance

NCBA Group has successfully acquired 100 percent ownership of AIG Kenya Insurance Company Limited (AIG Kenya), thereby enhancing its presence in the financial services industry.

For over 18 years, NCBA has maintained a minority shareholding in AIG Kenya. This strategic acquisition integrates a well-established insurance business with a stellar market reputation for providing comprehensive general insurance solutions to corporates, SMEs, and individuals, into NCBA.

This acquisition follows the approval by NCBA’s corporate board in early September 2023 to purchase the remaining 66.7 percent of AIG Kenya’s total shares, aiming to achieve full control of the insurer.

The plan includes injecting an additional Sh2 billion into the local subsidiary of AIG Kenya, further solidifying the business.

Prior to the full acquisition, NCBA held 33.3 percent of AIG Kenya’s total shares.

The execution of this transaction required thorough due diligence and approvals from the Boards of NCBA, AIG Kenya, AIG Group, as well as regulatory authorities in banking, insurance, and other sectors.

NCBA’s Group Managing Director, John Gachora, expressed confidence in the acquisition, viewing it as a catalyst for revenue growth.

“We are excited to welcome AIG Kenya to the NCBA family, and this acquisition will enable our customers to conveniently access all their financial products under one roof,” said Gachora.

He said AIG Kenya’s insurance capabilities will unlock opportunities to catalyse deeper insurance market penetration in Kenya and the East Africa region.

Notably, AIG Kenya CEO Stella Njunge highlighted the need for more collaboration between banks and the insurance sector.

“The acquisition marks a significant milestone in our company’s evolution. NCBA’s resources, expertise, and expansive network will enhance our capabilities, allowing us to offer a broader range of products and services,” said Njunge.

AIG Kenya joins six other NCBA Group  subsidiaries – NCBA Investment Bank, NCBA Leasing LLP, NCBA Bancassurance Intermediary Ltd, NCBA Bank Uganda, NCBA Bank Tanzania and NCBA Bank Rwanda.

The insurance industry, with a Compound Annual Growth Rate of 10 per cent, has a low penetration rate in Kenya, currently at 2.43 per cent.

Banks in the country have been keen to tap the insurance market, with almost every lender currently having a bancassurance offering, with major lenders going for stand-alone underwriting businesses through subsidiaries.

Apart from NCBA, Equity has also gone big into the insurance sector having received approvals from the regulator-Insurance Regulatory Authority (IRA) to set up a general insurance company in May 2023.

The move into general insurance by banks is likely shake-up the market that currently has about 56 major players.

Related Posts

Ghana: GCB Bank collaborates with SEHP to support BECE student

GCB Bank, the leading financial institution in Ghana, has once again demonstrated its commitment to community development and…

Nigeria: Afreximbank to train businesses for AfCFTA

The African Export-Import Bank has announced its plan to launch a capacity development program to empower African businesses…

Kenya: Tanzanian firm to acquire Bamburi Cement for Sh23 billion

Tanzania’s Amsons Group, a manufacturing and energy company, seeks to acquire a full 100% stake in Kenya’s Bamburi…

Nigeria: UBA’s GMD named Chairman of CIBN Body of Banks’ CEOs

Group Managing Director/Chief Executive Officer, United Bank for Africa, (UBA) Plc, Oliver Alawuba, has been named the Chairman…

Leave a Reply

Your email address will not be published. Required fields are marked *