Sidian Bank has secured $12 million (Sh1.2 billion) in tier II capital from the Investment Fund for Developing Countries (IFU), a Danish development finance institution, to strengthen regulatory capital ratios and expand lending operations, according to a March 2019 report.
The funding will prioritize growth in small and medium enterprise (SME) loans, trade finance, and mobile lending, as stated by bank chairman James Mworia. He described the investment as a significant endorsement of Sidian's strategic direction by a global financial services investor.
"This capital will support expansion of risk assets, including the loan book, building on the bank's track record of effectively utilizing prior capital raises," Mworia said. The injection followed a Sh1.5 billion shareholder capital raise in February 2018, which included a Sh1.1 billion contribution from Centum Investment Company.
Centum acquired a majority stake in Sidian in November 2014. IFU Vice President Morten Elkjaer emphasized the deal marks the fund's first financial services investment in Kenya, aiming to enhance access to finance for SMEs and drive sustainable development through timely financial services.
IFU, based in Copenhagen, operates regional offices across Asia, Africa, Latin America, and Eastern Europe. Sidian CEO Chege Thumbi said the investment would improve liquidity, expedite funding access for SMEs, and enhance profitability through stronger financial backing and operational efficiency.
