Stanbic freezes plans for a fintech subsidiary months after green light
Chief Executive Officer of Stanbic Bank Kenya and South Sudan Joshua Oigara speaks during the lenders 2023 full-year financial results briefing held on March 06, 2024, at Serena Hotel in Nairobi. PHOTO | BILLY OGADA | NMG
Stanbic Holdings has put on hold plans to set up a fintech subsidiary months after the Capital Markets Authority(CMA) granted it approval.
The lender had not given details about what it intended to do with the subsidiary but now says the board has decided to pause the idea.
“We reviewed that decision at the board level and what we have done is put it on hold at the moment. If we need to come back to it, we will, but for now, that is the position,” said Joshua Oigara, CEO at Stanbic Bank Kenya and South Sudan.
Stanbic had in the financial year ended December 2022 said it was open to acquiring or partnering with fintech or mobile network operators as an option to “exponentially grow business.”
The CMA had in the quarter that ended December 2023 said it had approved a shareholder circular by Stanbic for the “incorporation of a fintech subsidiary.” This would have become the fifth subsidiary.
Stanbic Holdings, which is owned by Standard Bank Group, currently has four subsidiaries—Stanbic Kenya, Stanbic South Sudan, Stanbic Bancassurance Intermediary, and SBG Securities.
The holdings company in 2021 said it was seeking partnerships with Chinese financial technology firms to boost Sino-Africa trade. The firm had said by collaborating with Chinese fintechs, Kenyan traders would be able to find suppliers of quality products in China and also settle transactions conveniently.
Standard Bank has been open to partnering with fintechs and the same strategy appears to be trickling down to its subsidiaries outside South Africa.
Nigeria’s Stanbic IBTC Holdings, also part of Standard Bank Group, in 2022 started a fintech subsidiary called Zest Payments Limited which functions as a payment solution service provider.
Stanbic Holdings net profit for last year by 34 percent to Sh12.2 billion. Stanbic Bank Kenya's net earnings grew 30 percent to Sh11.5 billion while that of Stanbic South Sudan went up 50 percent to Sh460 million.
The Bancassurance Intermediary net profit rose by 93 percent to Sh214 million as that of SBG moved to Sh149.72 million net profit from a loss of Sh1.87 million.
