Bank led by Kenyan tycoon Gideon Muriuki recoups $1.56-million loan from Centum unit

Co-operative Bank Group, led by Kenyan banking tycoon Gideon Muriuki, has successfully recouped a loan of Ksh228.2 million ($1.56 million) that it extended to Centum’s real estate subsidiary, Uhuru Heights Limited, during its 2022 fiscal year.

This repayment was disclosed in the latest annual report of Centum’s unit, marking the conclusion of a debt facility in which the bank had initially approved funding of up to Ksh2 billion ($13.6 million).

The loan had been granted for the development of the Cascadia Apartments, the second project within the Two Rivers complex that Co-operative Bank had supported.

Centum had previously secured a Ksh8 billion ($55 million) loan from Co-operative Bank for the Two Rivers Mall development, which was repaid in 2019 through a new credit facility from South Africa’s Standard Bank. This strategic move was aimed at reducing financing costs.

Centum cited that the interest rate on the Standard Bank loan was comparatively lower than what it had incurred on the Co-operative Bank facility. This shift in financing reflected the reduced risk associated with the mall project since the initial local lender funding.

Cascadia Apartments, a part of the sprawling 100-acre Two Rivers Development, features one-, two-, and three-bedroom units, adding to the portfolio of Centum’s real estate ventures.

Co-operative Bank Group is one of the largest financial institutions in East Africa, with subsidiaries including Kingdom Securities Limited, Co-optrust Investment Services Limited, Co-operative Consultancy & Insurance Agency Limited, Kingdom Bank Limited, and Co-operative Bank of South Sudan.

The bank has adopted a cooperative model to revolutionize the banking experience in East Africa. It has leveraged innovative financial solutions to drive social and economic transformation across a wide range of operations.

Gideon Muriuki, a prominent figure in the Kenyan financial sector, holds a substantial two percent stake in Co-operative Bank Group, translating to 117,471,300 ordinary shares in the Nairobi-based lender.

In a significant move aimed at furthering support to micro, small, and medium-sized enterprises (MSMEs) in Kenya by enhancing access to loans, the group recently secured a long-term loan of $100 million.

This loan was obtained through a consortium led by DEG, a Germany-based development finance institution and a subsidiary of KfW Group. This initiative underscores the bank’s commitment to promoting economic growth and financial inclusion in Kenya.