- NCBA Group, a financial services provider and one of the largest banks in Kenya, has completed a 100% buyout of AIG Kenya for an undisclosed amount, making the company a wholly-owned subsidiary of the Group.
- NCBA acquired AIG Kenya from American International Group Inc. and has secured the necessary approvals from the Competition Authority of Kenya, the Insurance Regulatory Authority of Kenya, and the Central Bank of Kenya.
- This acquisition follows NCBA Group's record of 4.6% growth in its net profit for Q1 2024 and a 55.7% growth in net profit for the year ended December 2023.
NCBA announced plans in September 2023 to buy out AIG Kenya, with its board approving the transaction. After announcing its plans, NCBA’s subsidiary, Bancassurance Intermediary Ltd, launched a digital insurance portal in October 2023. Now, it wholly owns an insurance company.
Previously, NCBA held a minority stake in AIG Kenya for up to 18 years. The acquisition means it has bought the remaining 66.7% stake in the firm.
In 2022, NCBA’s investment in AIG Kenya reportedly reached KSh1.03 billion, up from KSh 987.3 million the previous year. It also earned KSh 90 million as a dividend from AIG Kenya in 2022, up from KSh 40 million.
AIG Kenya has been operating in Kenya since 1972, offering insurance to corporates, SMEs, and individuals. Following the acquisition, NCBA will tap into AIG’s customer base and market reputation to offer its financial services to a wider audience and, in turn, provide its customers with more options.
At the time of announcing the plan in September, John Gachora, the Group Managing Director at NCBA Group, said that the acquisition would help NCBA achieve its ambition of becoming “a universal bank that addresses the full set of our customers' financial needs.”
Now, he mentioned that “with insurance increasingly becoming a basic financial need for our customers, an ecosystem of NCBA’s physical and digital distribution platforms and AIG Kenya’s insurance capabilities will unlock opportunities to catalyse deeper insurance market penetration in Kenya and East Africa region.
Meanwhile, NCBA is not the only Kenyan bank eyeing Kenya’s $2.3 billion insurance industry. Equity Group, another notable big player, said in May 2023 that it has received in-principle approval from the Insurance Regulatory Authority (IRA) to set up a General Insurance Company.