South Africa-based Barclays Africa has formally acquired a controlling stake in Kenya’s First Assurance after receiving regulatory approval.
The approval is the culmination of a proposal that was fronted in June last year by Barclays to buy a 63.3 per cent stake in the insurance firm. In addition, the group had also expressed desire to inject additional capital of Sh700 million. Speaking at Serena Hotel on Tuesday evening during a ceremony to formalise the Sh2.9 billion transaction, Barclays Kenya CEO Jeremy Awori said the acquisition would help the bank to spur growth in the insurance industry.
“When we marry insurance and banking, we shall build something great. We see great potential in this industry. This transaction also signifies the commitment of Barclays Africa to the future of its business across the continent,” he said.
The addition of First Assurance to the Barclays family will see the bank diversify its revenue portfolio as it seeks to break from its reliance on corporate and retail lending market.
Already, the group is buoyed by the performance of Barclays Life Assurance Kenya (BLAK), which was formed in April last year. It will now run First Assurance’s life business.
According to BLAK CEO William Maara, the insurer will leverage on the successes of Barclays Bank to grow insurance segment. Speaking at the same function, First Assurance CEO Stephen Githiga said that the partnership would serve to strengthen the insurer’s muscle and give it capacity to underwrite higher risks. “The additional capital means that we can now underwrite high-capacity risk,” said Mr Githiga.
The deal will see 100-year-old Barclays Kenya attempt to catch up with its counterparts in the banking sector who have branched into the insurance market. Source: Standard Media