A branch of Dubai Islamic Bank. (Photo: Courtesy)
Dubai Islamic Bank (DIB), the largest Islamic lender in the United Arab Emirates, has beaten bitter regional rival Qatari National Bank to the first licence in Kenya.
DIB Bank Kenya received its licence on Friday last week and has announced it will open three branches at Westlands, Upper Hill at the head office and Kilindini in Mombasa.
The lender has ambitions to expand into the largely-untapped Islamic banking market in Kenya where there are an estimated 4.3 million Muslims, roughly 11 per cent of the population, and an opportunity to reach non-Muslims with growing appeal of Islamic financial products.
“Kenya is critical to DIB’s growth plans in Africa,” said DIB Group Chief Executive Adnan Chilwan.
“Apart from the potential that the local economy offers, the Kenyan franchise will serve as a stepping stone for us to further expand and entrench ourselves in the East African belt.”
The approval process was already in motion before a moratorium by Central Bank of Kenya on licensing of new banks in November 2015.
It is also well known that Qatari National Bank (QNB) has previously expressed interest in the country, including intentions to buy a local bank with regional presence.
QNB later acquired 23.5 per cent of Ecobank International in September 2015, and may still harbour intentions of increasing its presence in Kenya given that it has been advertising its financial results in local dailies for the past three years.
The largest bank in the Middle East and Northern Africa with a whopping $147.9 billion (Sh15.2 trillion) in assets, the lender made an eight per cent increase in profit from 2014 to post $3.2 billion (Sh330 billion).
When Kenya floated the Eurobond last year, QNB Capital placed a bid of $200 million (Sh20.4 billion) and has expressed an interest in arranging a Sukuk (Islamic sovereign bond) for Kenya.
It is also keen to help Kenya set up the Nairobi International Financial Centre.