Equity Group chief executive James Mwangi during the announcement of the group’s 2023 full year financial results at an investor briefing at Equity Centre in Nairobi on March 27, 2024.
Photo credit: Wilfred Nyangaresi | Nation Media Group
Equity Group shareholders have approved the establishing a new health insurance subsidiary moving the lender a step closer to expanding its insurance offering beyond life and general categories.
The new health insurance company will be incorporated in Kenya and will be a subsidiary of the group through the company’s insurance holding company.
Equity Group is expected to provide initial capital to the new unit with the disbursement of Sh800 million for the share capital of the health insurance unit.
Shareholder nod clears the board of Equity Group to effect the incorporation of the new unit including providing approvals required from the company as the sole shareholder in the Insurance Holding Company.
Equity Group Insurance Holding Limited already undertakes a life insurance and general insurance business in Kenya.
In the year ended December 2023, Equity’s insurance business realised Sh1.6 billion in gross revenue with 9.9 million cumulative policies issued.
The lender started its life business in 2022 and offers life insurance alongside retirement solutions to all categories of customers.
The unit known as Equity Life Assurance Kenya realsed a profit before tax growth of 39 percent to Sh934 million.
Equity Group expects to start rolling out insurance products for both its health and insurance categories later this year as the bank steps up its business diversification into new segments.
The lender's shareholders have also given their approval to the creation of a new banking holding company which is set to consolidate the activities of all banking subsidiaries within the group.
Equity Group is now set to operate under four groups including; the Banking Group, Insurance Group, Technology Group, and Foundation Group.
Equity Group operates banking subsidiaries in Kenya, Uganda, Tanzania, South Sudan, Rwanda, and the Democratic Republic of Congo (DRC).
The shareholders have also ratified the payment of Sh15.1 billion in dividends or a payout of Sh4 per share representing the payout for the period ended December 31, 2023.
The dividend payment matches the payout made at the end of 2022 despite the bank recording a 6.48 percent dip in net profit to Sh41.98 billion on higher provisions for expected bad loans.
Moreover, the shareholders have ratified the Cogebanque acquisition which lifted Equity Bank Rwanda to the second-largest bank in the country by market share.
