Equity Group and KCB secure exemption to keep majority stakes in DRC, bolstering regional banking amid new ownership rules.
Equity Group and KCB Retain Controlling Stakes Amid Regulatory Pressure
Kenyan banking giants Equity Group and KCB Group have successfully secured exemptions from the Democratic Republic of Congo’s (DRC) new banking regulation, Instruction 18, which required foreign-owned banks to reduce their stakes in local subsidiaries to at least 45% local ownership by the end of 2026.
This ruling allows Equity Group to maintain an 85.4% stake in Equity BCDC and KCB to retain 85% ownership in Trust Merchant Bank (TMB), avoiding potential multi-billion-shilling divestments that would have reshaped their regional footprint.
Background: The DRC’s Banking Ownership Rule
Introduced by the Banque Centrale du Congo (BCC), Instruction 18 aimed to increase local participation in bank ownership, demanding foreign lenders dilute shares to four unrelated Congolese shareholders holding at least 15% each. This policy sought to boost national control over the country’s financial institutions.
However, Equity Group and KCB argued that listed banks like themselves should be exempt from these requirements, citing a regulatory oversight. On May 27, 2025, Equity Group formally petitioned the DRC parliament through the Association Congolaise des Banques (ACB), highlighting that the rule did not account for publicly listed companies.
Equity Group’s Strategic Position in DRC
Since entering the DRC market in 2015 by acquiring an 86.6% stake in ProCredit Bank Congo (renamed Equity Bank Congo), Equity Group has aggressively expanded. A major milestone came in 2020 when Equity acquired 66.53% of Banque Commerciale du Congo (BCDC) from the George Arthur Forrest family for USD 95 million. The merger created EquityBCDC, the country’s second-largest bank with total assets valued at approximately KSh 656.5 billion (~USD 5.4 billion), serving over 1.3 million customers through 74 branches as of 2024.
In 2023, Equity Group increased its stake in EquityBCDC to 85.4% by purchasing an additional 6.6% for about KSh 9.24 billion (~USD 75 million), valuing the subsidiary at roughly KSh 140 billion (~USD 1.1 billion). Had the ownership dilution taken effect, the bank would have faced divesting nearly 30%, worth an estimated KSh 42 billion (~USD 340 million).
KCB’s Expansion and Local Presence
Similarly, KCB Group entered the DRC in August 2022 through acquiring an 85% stake in Trust Merchant Bank (TMB), a prominent financial institution established in 2004. This USD 130–170 million deal was finalized in December 2022 after receiving approvals from regulators in Kenya, the DRC, and the COMESA Competition Commission.
KCB maintained the TMB brand to leverage its deep local market expertise and extensive branch network. The bank has focused on enhancing digital banking capabilities, trade finance, and cross-border trade, aiming to strengthen regional integration and financial inclusion.
What the Exemption Means for Kenya and the DRC
Equity Group CEO Dr. James Mwangi welcomed the exemption, saying, “The DRC Senate has recognized the importance of allowing us to continue our investment without forced divestiture. This decision strengthens our ability to support economic growth and financial inclusion in the region.”
The exemption shields both banks from forced sales that could have weakened their capital base and operational capacity in one of Africa’s fastest-growing economies. It also underscores Kenya’s growing influence in the DRC’s banking sector and signals regulatory flexibility to support foreign investment.
Regional Banking and Future Outlook
With robust balance sheets and strong regional footprints, both Equity Group and KCB are well-positioned to capitalize on Africa’s emerging market opportunities. The DRC, rich in minerals and natural resources, remains a strategic market with huge growth potential.
Maintaining majority control in their DRC subsidiaries enables these Kenyan lenders to expand product offerings, innovate digital solutions, and fuel trade financing—critical for regional economic integration under frameworks like AfCFTA.
