Listed lender NIC Bank has opened a new leasing subsidiary, NIC Leasing Limited Liability Partnership, in a bid to tap into the growing opportunities in the leasing market.
The introduction of NIC Leasing is a natural evolution for NIC Bank which has a strong heritage in Asset Financing. The subsidiary will now enable the group to offer customers the asset, their financing solutions as well as insurance through their Bancassurance subsidiary.
The Bank received approvals from the Central Bank of Kenya to set up the subsidiary in December 2014. The operating model employed by NIC Leasing LLP is unique and a first in the domestic market. The model will see NIC Bank partnering with Mercantile Finance, another wholly owned subsidiary of the bank.
NIC Bank Group Managing Director John Gachora said the move to set up the new subsidiary fits into the Bank’s aggressive growth strategy, especially in the Asset Finance space, which has become very competitive over the last few years.
“Leasing is slowly gaining traction in the Kenyan market. Recent leasing initiatives by the Government are a positive move towards growing the market and we are confident that NIC Group is well positioned to support this growing market,” said Mr Gachora.
Leasing is catching on in Kenya with the Government taking the lead especially in the leasing of motor vehicles and medical equipment. Leasing offers companies various advantages including optimised cash flow management by freeing up capital which can be invested in other areas of the business.
NIC Bank’s Executive Director, Corporate Banking, Alan Dodd, said the subsidiary will mainly be looking at assets such as motor vehicles as well as focusing on leasing equipment in the FMCG, Construction and Healthcare sector.
Provide the equipment and the financing
“Previously we would link customers with leasing companies and provide the financing. With NIC Leasing we are now able to provide the equipment and the financing all under one roof. Through NIC Leasing we intend to offer professional services to our customers from inception, during the lease and at the end,” said Mr Dodd.
NIC Bank worked with renowned international leasing consultant Sudhir Amembal to set up the subsidiary.