I&M Group has spent Sh2.4 billion to buy a building in Tanzania that now serves as the headquarters for its Dar es Salaam operations and host of its key branch as it seeks to deepen its presence in that market.
The Nairobi bourse-listed firm acquired I&M House@1046 in Dar es Salaam last year through its property investment subsidiary, I&M Realty Tanzania.
The amount spent in the transaction has been disclosed by the Kenyan banking multinational in its latest annual report for the year ended December 2024.
I&M Bank Tanzania, previously headquartered in Maktaba Square, moved to the newly acquired property to enable it to make ICT infrastructural investments needed to support its growth in the country.
“The reason for having an owned property is because the bank has to make tailor-made changes to protect its ICT infrastructure and making such heavy investments in a rented property can be expensive if the premises have to be surrendered at a later date,” said sources within the bank.
“Property investments in the bank distort the ratios, and it is advisable to do so in a separate property investment company."
The group owns 78.5 percent of the Tanzanian banking operations, but has full ownership of the new property, which is held under its fully owned subsidiary, I&M Realty Tanzania.
The property investment follows improved performance by the Tanzanian unit, whose contribution to the group’s profit after tax rose to 5.7 percent in 2024 from two percent a year earlier.
The subsidiary's net profit rose 3.5 times to Sh957 million from Sh273 million, riding on cost management.
I&M entered the Tanzanian market in 2010 through the acquisition of CF Union and operates eight branches. It has a customer base of 20,600, who are served by a staff of 197.
The bank's loan book stood at Sh23.2 billion, while its deposit base was Sh44.5 billion.
The subsidiary cleaned up its bad loans last year, shrinking its gross non-performing book to 8.4 percent in December 2024, down from 17.4 percent a year earlier. A tightening of its expenses saw its cost-to-income ratio fall to 55 percent from 62 percent in 2023.
It has expressed intentions to increase its footprint in the country, whose low financial inclusion makes it a good hunting ground for banks.
Recently, the group raised a total of Sh4.1 billion in new capital through the issuing of 86.5 million shares to a consortium of institutional investors led by private equity firm AfricInvest. The capital raising gives it a war chest for expansion activities, including digitisation.
I&M Group has banking operations in Kenya, Rwanda, Tanzania, Uganda and Mauritius. The group's profit after tax for the year 2024 was Sh15.3 billion, up from Sh12.6 billion a year earlier.
Kenya contributed 72.4 percent of the group's bottom-line, with Tanzania second at five percent.
