After 16 years in the East African nation, Diamond Trust Bank Kenya (DTB) has announced plans to sell all its shares in its Burundi subsidiary.
According to DTB’s Board of Directors, a consortium of mostly Burundian investors, including DTB Burundi’s current minority shareholder, made an offer to buy the company’s 83.67 per cent stake.
However, regulatory approval from Kenyan and Burundian authorities is still pending.
The decision resulted from the minority shareholder’s desire to increase their share and work with other local investors to further the bank.
Diamond Trust Bank to focus on core markets
The DTB Group’s CEO, Nasim Devji, confirmed the transaction and explained that it aligned with the bank’s strategy to concentrate on its core markets: Tanzania, Kenya, and Uganda.
According to Devji, the lender’s strategic decision was also meant to support Burundian investors who wish to encourage financial inclusion in their local community.
“The DTB Kenya Board has reviewed the offer from the consortium and our long-standing partner in Burundi and considers that it represents a fair value and return on investment for DTB,” Devji said.
She added: “The consortium has committed to maintaining and further lifting the bank’s financial inclusion agenda on an already established platform of good governance and good risk management while applying their local business acumen.”
How Diamond Trust Bank began operations in Burundi
DTB Burundi, which serves corporate, business, and retail clients, opened its doors in Bujumbura in 2009 and has since expanded to four locations. Since then, it has become one of the country’s top ten banks.
According to Devji, DTB leaves behind a trustworthy and well-run financial institution.
“DTB entered Burundi 16 years ago as part of its financial inclusion agenda, and will be leaving behind a stable, well-managed financial institution,” she intimated.
Diamond Trust Bank Burundi urged shareholders to take caution
DTB, a company listed on the Nairobi Securities Exchange (NSE), issued a warning to shareholders and investors through its company secretary, Stephen Kodumbe, to use caution when handling DTB securities until the deal is finalised.
The notice reads, “Completion of the proposed transaction is subject to conditions that are customary for transactions of this nature, including receipt of all regulatory approvals from, amongst others, the Central Bank of Kenya and the Bank of the Republic of Burundi, and notifications to the Capital Markets Authority and, if required, other relevant regulators”.
DTB is departing Burundi to focus on its three main markets, where it intends to boost financial inclusion, scale up innovation, and consolidate growth to maximise shareholder value.