The International Finance Corporation has acquired a 6.71 per cent stake in Equity Group, becoming the lender's second largest shareholder.
IFC bought the approximately Sh13.9 billion worth of shares from Britam Holdings last month as the insurer sought to diversify its portfolio.
Through the investment, Equity committed to zero lending for coal related projects such as the development or expansion of coal-fired power plants, coal mines and transportation assets used exclusively for coal.
Equity Group managing director James Mwangi said the bank has further, agreed to allocate USD 80 million (Sh9.2 billion) equity towards climate related interventions covering all subsidiaries over the next five years.
African investment company Arise B.V., backed by institutional investors Norfund, FMO and Rabobank, is the top shareholder with an 11.99 percent stake in the Kenyan banking multinational.
"As Equity Group, we are delighted to welcome IFC, a member of the World Bank Group to the Equity family as our second largest shareholder," Mwangi said on Tuesday.
During the event, IFC alongside British International Investment (BII) and Symbiotics, ResponsAbIility from Switzerland committed to raising USD 165 million ( Sh 19 billion) towards Equity’s 'Africa Recovery and Resilience Plan’.
Equity, through its regional banking subsidiaries, plans to finance at least five million micro, small and medium sized businesses (MSMEs) and 25 million vulnerable households.
The lender anticipates to create at least 50 million direct and indirect jobs at the realisation of its private-sector driven plan.
The plan, which is estimated to cost the insurer Sh700 billion ($6 million) has so far gained $1.5 billion external funding, Mwangi said.
"We are encouraging banks within the region to compliment the plan so that its an integrated plan by all," he added.
Ten development banks including AfDB, European Development Banks the Commonwealth Secretariat, are said to have jumped on board as well.
The credit facility includes $50 million from IFC, $ 50 million from British International Investment (BII) and $ 65 million from Symbiotic, Responsibility and FMO.
This now rises total loans granted to Equity by IFC to $300 million and that from BII to $100 million.
Equity posted a net profit of Sh68.8 billion in 2021 reversing a net loss of Sh9.1 billion over a similar period in 2020.
The Group’s net loans and advances book clocked 23 per cent growth from Sh477.8 billion in 2020 to Sh587.8 billion in 2021.
The lender's earnings per share almost doubled from Sh5.20 billion in 2020 to Sh10.40 billion in 2021, a 98 per cent growth.
