Bank of Kigali on earnings, consolidation plans

Bank of Kigali, Rwanda's leading bank by assets, has reported a significant profit of 25 billion francs for the first nine months of 2019. In an exclusive interview with CNBC Africa, the Bank's Chairman, Marc Holtzman, highlighted the impressive growth and success of the bank over the past decade under his leadership. Holtzman commended the efforts of the bank's CEO, Dr. Diane Caracicio, and the entire team for their remarkable achievements. He noted that in the span of 10 years, Bank of Kigali has grown from $200 million to over a billion dollars in assets, becoming the first bank in Rwanda to reach this milestone. The key focus for the bank has been on serving the population, promoting financial inclusion, and driving economic growth in the country. With Rwanda's economy showing strong growth indicators, Bank of Kigali remains committed to facilitating and supporting this upward trajectory. The interview delved into the impact of recent policies on the banking sector in Rwanda, particularly concerning consolidation and the potential effects on smaller banks. Holtzman emphasized that consolidation can be beneficial in ensuring financial stability and enhancing competitiveness in the sector. He highlighted the importance of homegrown Rwandan banks like Bank of Kigali and KOSHA Bank, leveraging their expertise to support the local economy's growth. However, concerns were raised about the access to financing for key sectors like agriculture, which contributes significantly to Rwanda's economy. Despite agriculture accounting for 30% of the country's GDP, bank lending to this sector was only 6% last year. In response, Bank of Kigali has launched a new program called ICOFI, specifically targeting small farmers and enhancing financial inclusion in the agricultural sector. The bank has already disbursed over 8 billion Rwandese francs in loans to small farmers in the last three months alone, demonstrating its commitment to bridging the financing gap in this critical sector. Holtzman highlighted the bank's innovative approach to lending, with the ability to approve loans in an average of three minutes through its digital platform. This swift process enables quick access to funds for farmers, promoting efficiency and productivity in agriculture. The conversation shifted towards the evolving landscape of banking and the role of fintech companies in reshaping the industry. Holtzman acknowledged the transformative impact of fintech on traditional banking models, emphasizing the need for continuous reinvention to stay ahead of competition. He outlined Bank of Kigali's proactive stance towards embracing technological advancements and providing fintech-like services to cater to changing consumer demands. The bank has established a digital factory and technology incubator, housing a young and dynamic team dedicated to driving innovation and customer-centric solutions. With a focus on flexibility, adaptation, and customer convenience, Bank of Kigali aims to position itself as a leader in delivering cutting-edge financial services in the Rwandan market. Holtzman's insights shed light on the bank's strategic initiatives to enhance its digital capabilities, compete effectively with fintechs, and maintain its status as the largest bank in Rwanda with a 35% market share.