National Bank of Kenya Limited. will raise as much as $119m in a rights offer to fund an expansion plan as it seeks to quadruple revenue by 2017, its Managing Director, Mr. Munir Sheikh Ahmed, said.
The sale of shares to existing shareholders is expected to take place by the first quarter of 2014, Ahmed said in an interview at his office in Nairobi, on Thursday.
Bloomberg News reported that the funds will be used to open 10 new branches in Kenya and start operations in South Sudan, Uganda and Somalia, he said.
“The strategic plan is to ensure the bank’s potential, described as a sleeping giant, is realised in the next five years,” Ahmed said. The bank is targeting revenue of 31 billion shillings by 2017, compared with eight billion shillings last year, he said.
National Bank was the only publicly traded lender in Kenya to report a drop in profit in 2012. Net income dropped by 53 per cent to 729.8 million shillings as earnings from interest on loans dipped by six per cent to 4.77 billion shillings.
Results in the first quarter of 2013, which have to be published, suggest the company will achieve an improved performance this year, Ahmed said.
“We expect better growth on a year-to-year basis,” he said.
Ahmed took over as managing director on August 1 from Reuben Marambii, who held the post for 14 years after being seconded by the Central Bank of Kenya in 1999 to save the loss-making lender from collapse and return it to profit.