Equity Bank Uganda has signed a Memorandum of Understanding (MOU) with the Uganda National Oil Company (UNOC) as part of efforts to facilitate and strengthen collaboration in the country’s financing and enterprise development.
Equity Bank Uganda is one of many operating subsidiaries of Equity Group Holdings, a leading financial services group led by James Mwangi, a Kenyan multimillionaire businessman and banking executive.
The MOU between Equity Group Holdings and Uganda National Oil Company will promote financing and enterprise development in the MSMEs, clean energy, and environmental conservation sectors.
It will also put Equity Group in a position to offer financial services to UNOC and its value chain. This includes providing competitive working capital to corporates and SMEs in the Oil and Gas value chains.
Mwangi, group managing director and CEO of Equity Group Holdings Plc, stated that the opportunity for Ugandans to benefit from the wealth created by the development of the oil and gas sector and all of its support sectors is significant, as wealth creation is the quickest tool to lift our people out of poverty, and the needs of the oil and gas sector will serve as this vehicle.
“This MOU brings our two organizations together as promoters of the development of the oil industry in Uganda, representing national interests, the Government of Uganda, and the people of Uganda, and of a regional financial group that has the capability and knowledge to allow citizens to participate in economic activities,” he added.
Mwangi revealed in his comments on how to fund the entire ecosystem that it has set aside $6 billion for its revolving fund as the most important component is the component of capacity building.
“We will solve the problem of financial inequity such that cash is moving from one partner to the other at different stages when we fund the entire ecosystem with a revolving fund that supports the entire oil sub-sector,” he explained.
“One of the challenges we have discovered as local companies is the aspect of financing,” Proscovia Nabbanja, CEO of UNOC, said. “That is why we are partnering with reputable organizations like Equity Group to bring financial products that are tailored for the SMEs to participate in the sector.”
The move comes nearly three weeks after Equity Group, Kenya’s largest financial services group led by Mwangi, reported a record-high profit of Ksh40.1 billion ($350.2 billion) at the end of its 2021 fiscal year, owing to improved performance across all operating segments.
Its profit after tax increased by 99 percent from Ksh20.1 billion ($175.5 million) in 2020 to Ksh40.1 billion ($350.2 million) at the end of 2021, keeping it not only Kenya’s largest lender but also the most profitable bank in East Africa.
The financial services group’s strong performance in 2021 can be attributed to the consistent growth in interest and non-interest income, as well as well-executed cost and treasury management strategies throughout the year.
