Kenya’s fourth biggest bank by capitalization, NCBA Group, has acquired insurer AIG Kenya from AIG Inc for an undisclosed amount.
Over the past 18 years, the NCBA Group held a minority share in the Kenyan subsidiary of the American International Group (AIG), and with the recent purchase of the company, NCBA Global is now a majority shareholder.
The buyout deal by NCBA Global gives the lender 66.67% control of AIG Kenya, which now controls 2.14% of Kenya’s insurance market.
With insurance increasingly becoming a basic financial need for the type of customers we serve, an ecosystem of NCBA’s physical and digital distribution platforms and AIG Kenya’s insurance capabilities will unlock opportunities to catalyze deeper insurance market penetration in Kenya
John Gachoras, NCBA Managing Director
This latest acquisition by NCBA Global collaborates with the lender’s ambition to become a universal bank, providing its customers with all their financial needs.
One example of such ambition is that of the largest bank in Kenya, Equity Group, which announced in March that it will enter the general and health insurance market this July, following its successful launch of life insurance in 2022.
Kenya’s insurance industry is worth $2.3 billion (KES 300 billion). This puts NCBA in a position to acquire larger shares of the industry as more Kenyan lenders move into the insurance industry because of low competition.
At the moment, the leading African nation in insurance penetration is South Africa at 17%. Followed by Namibia (7.8%), Morocco (3.9%), and Kenya at 3%.