Kenya Commercial Bank Group Plc plans to enter Ethiopia’s banking market by 2027 through a strategic acquisition, as it looks to capitalize on the country’s recent financial sector liberalization.
KCB will pursue both retail and corporate banking opportunities, with a focus on digital channels to reach Ethiopia’s dispersed and underbanked population, according to Chief Finance Officer Lawrence Kimathi. “The best way to reach customers across Ethiopia is digitally,” Kimathi said in an interview.
The lender is targeting an acquisition of a local bank, in line with Ethiopia’s Banking Business Proclamation No. 1360/2024, which permits foreign investors to own up to 40% in domestic banks and caps total foreign ownership at 49%. The law also mandates that at least one-third of a foreign-owned bank’s board be composed of Ethiopian nationals.
The planned entry marks KCB’s first foray into Ethiopia and expands its regional footprint, which already spans Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan, and the Democratic Republic of Congo.
KCB has experience with regional M&A activity. It recently integrated Banque Populaire du Rwanda into BPR Bank Rwanda, now the country’s second-largest lender, and divested its stake in National Bank of Kenya to Nigeria’s Access Bank Group.
The announcement comes as KCB reported an 8% rise in first-half 2025 net income to Ksh 32.3 billion ($249 million). The group declared its largest-ever interim and special dividend payout of Ksh 13 billion ($100 million), underlining strong profitability and capital reserves.
Ethiopia, Africa’s second-most populous country, is opening its financial sector to foreign competition in a phased reform aimed at attracting investment, boosting innovation, and expanding financial inclusion.
