Equity Bank Shuts Down Seven Branches in South Sudan, declares it “Dormant”
Equity Bank (EQTY) has revealed that it has reduced the number of branches in its South Sudan business from twelve to five citing a challenging business environment brought about by the devaluation the country’s currency and sustained political instability.
Equity bank CEO James Mwangi said the closure had led to retrenchment of a number of staff in those branches and approximately Sh 6 Billion had been written off.
Speaking at the bank’s AGM in Nairobi yesterday, Dr Mwangi urged investors to treat the business as dormant saying for now, they will take a “wait and see approach” as its likely not to make any profits over the next two years.
“We are waiting for peace to return but for now, shareholders should treat the South Sudan business as a dormant company although we will maintain the licence.” said James Mwangi.
In the full year period ended December 2016, the South Sudan business was the Bank’s worst performer recording a loss before tax of Sh 528 Million as customer deposits plunged by more than half.
Equity Bank joins a number of Kenyan firms including East African Breweries Limited (EABL), Kenya Commercial Bank (KCB Group) among others who have decided to halt their operations in the country.
Mr Mwangi also revealed that they injected Sh 1.0 Billion and Sh 2 Billion into Uganda business and DRC Congo business respectively.