Promsvyazbank, one of Russia's largest privately-held banks, is looking to Kenya, Nigeria and a host of other African countries to expand its business because of sluggish loan demand at home.
Russia's 10th largest bank eyes a piece of Nigeria,Kenya
One of Russia's largest banks is looking to set foot in the African market
“There is growing interest in Africa among (Russian) clients,” Alexander Meshcheryakov, head of transaction, documentary and international businesses at Promsvyazbank, told Reuters. “Many clients come to us with this topic and ask to help them with financing projects in the region.”
He said Africa's economies are predicted to grow faster than the global economy over the next decade as they try to attract foreign investors with tax breaks and guarantees.
“Africa is basically one of the fastest growing regions and could be the only economic region that has not yet unlocked its potential ... From a growth point of view, it’s likely to be the most promising one on the world map,” he stated.
Besides Kenya and Nigeria, Mr Meshcheryakov said the lender is also studying business opportunities in countries such as Tanzania, Uganda,Rwanda, Zambia among others.
Promsvyazbank, majority owned by long-established Russian bankers and billionaire brothers Dmitry and Alexei Ananyev, focuses on lending and maintaining accounts of corporate clients. The lender has also been rolling out retail business.
With its Africa expansion plans, Promsvyazbank will join other Russian banks already operating in the region, such as VTB, Gazprombank and Renaissance Capital.
Russia’s second biggest bank, VTB opened its subsidiary VTB-Africa in Angola in 2006, focusing mostly on corporate and investment banking but also featuring a small retail division for its clients’ employees.
Gazprombank Africa, a branch of Russia’s third largest lender Gazprombank, has had operation in South Africa since 2014.
Promsvyazbank has already signed an agreement with the African Export-Import Bank, also known as Afreximbank, and is setting up contacts with certain governments, Meshcheryakov said.
For now, Promsvyazbank will focus on financing projects in Africa, but may eventually consider opening a branch there, he said.
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