BK Capital, a subsidiary of the BK Group Plc, has entered into a partnership with SBG Securities Ltd, a subsidiary of Stanbic Holdings Plc to collaborate on arrangement for secondary and primary capital markets opportunities in each other’s presence market.
Carine Umutoni, the Managing Director of BK Capital said that the collaboration improves their capacity to be a catalyst in capital markets’ development, by providing firms with access to increased sources of alternative funding.
"We welcome this collaboration as it strengthens our commitment to be a catalyst to capital markets’ development, by providing firms with access to increased sources of alternative funding via the capital markets, as well as providing a greater range of investment options for individuals and institutional investors,” Umutoni said.
Gregory Waweru, the Head of SBG Securities, said that the collaboration will see them serve towards the growth of the Rwandan equities market.
"This collaboration underscores our commitment to the growth of the Rwandan equities market as demonstrated by our strong market position in recent years, with broker market share peaking to 36% and number 1 broker ranking in 2019. Over the last 10 years, SBGS has also contributed to the development of the Rwandan equities capital market by actively participating as an authorized selling agent for various public offers,” he said.
The collaboration also anticipates future market developments arising from regional market integration efforts, and the African Exchanges Linkages Project that seeks to facilitate cross-border trading of securities via licensed in-country executing brokers.
"We are particularly proud that this new collaboration with BK Capital is a trailblazer for the anticipated transformation of African stock exchanges through the exchange linkages project,” Waweru added.
The two firms said that the collaboration was driven by the need for a business model that would serve customers more efficiently and that would be more impactful to the broader market by leveraging on each other’s capabilities.
As part of the broader collaboration arrangement, SBGS transferred its retail brokerage business in Rwanda to BK Capital in November 2020 after receiving the requisite regulatory consent.
As a consequence of the collaboration with BK Capital, SBGS has applied to the Capital Markets Authority and the Rwanda Stock Exchange for the termination of its brokerage license in Rwanda, following which SBGS will no longer operate its branch office in Kigali.
BK Capital which is BK Group’s youngest subsidiary reported a 57 per cent growth in total revenues in 2020 driven by fees from advisory services, fund management service, securities brokerage business and Investment Income.
BK Capital which in 2020 launched a unit Trust Fund "Aguka” grew its assets under management by 32 per cent to Rwf11bn.