The broad media coverage that the Bank of Kigali (BK) Group received after cross-listing at the Nairobi Securities Exchange (NSE) spoke volumes. This is because, despite perceptions of protectionism that have lately been rife in the same regional media, the cross-listing offered a balm to doubts as to the direction in regional integration. The listing was indicative that, beyond enhancing BK’s corporate, brand and market values, it had a broader implication; it was yet another vote on the economic faith local businesses have in the EAC. Though it may not necessarily have seemed like it, it also may have been a call for more companies to follow suit. This is notwithstanding the fact that, as corporate executives will tell you, it is not something the board wakes up one morning and decides to do given the risk assessments and the projections that must be put forth with a fair amount of certainty. Yet, for this reason, companies draw attention having made the judgment call. As sector experts are quick to point out, companies cross-listing their shares buy access to more investors, greater liquidity, a higher share price, and a lower cost of capital. These incentives, therefore, make it worth consideration by some of the major companies in the region to list across the borders. Currently, some of the notable examples include Uganda’s Umeme which is cross-listed in the Nairobi bourse. These include such as the KCB Group and Uchumi Supermarkets which are listed across the region at the NSE, the Dar es Salaam Stock Exchange (DSE), Rwanda Stock Exchange (RSE) and the Uganda Securities Exchange (USE). Other notable companies include Nation Media Group and Equity Group, among others, at the NSE, RSE and USE. Though it depends on local market dictates, it gives hope to some us modest stock punters at the now added number of cross-listed companies for the growing variety of stocks on offer and the benefits of competition they portend. And, speaking of competition, many had hoped that, propped by the cross-listing, Bank of Kigali would soon make entry into the regional market with more robust banking services. It would have upgraded BK’s representative office in Nairobi into full-scale commercial bank. However, as BK group chief executive Diane Karusisi explained in the media, “We really want to satisfy the needs in our market before thinking of venturing into new markets in the region.” Experts agree that hers is a valid point, as the local market must always take precedence – first, to lay a firm foundation at home and, secondly, to secure steady a platform on which to begin exploring new possibilities abroad. It, nevertheless, is heartening for some of us that plans remain on course to venture afield into the regional market at some point, and hopefully in the not too distant future. But, to go personal for a moment, I would have liked to ask Ms Karusisi: With technology now a fact of our everyday life, would it not be possible to offer a humble service such as renewal of an ATM card for a customer caught in a bind as happened to me not too long ago? At the moment, BK’s rep office in Nairobi has a license to conduct research, marketing and other liaison roles on behalf of the bank. The office is yet to be accorded legal mandate by the regulating authority, Central Bank of Kenya, to engage in commercial banking services. This means that it serves the specific purpose to market BK’s products while developing client relationships to be tapped into when the time comes to offer full-scale commercial banking services. Nevertheless, for a stranded client with an urgent need of a particular service, the question posed above is also lased with the belief of the possible in the immediacy of the situation, especially given the innovative acumen the BK group continues to demonstrate earning it a lead in the sector locally. In addition to banking services, the group’s portfolio now boasts BK Insurance, the stock brokerage BK Capital and technology services business BK TecHouse. I cite BK only as an example. But with its cross-listing, it speaks of a wider trend in Rwanda. A Forbes analysis earlier this week shows how in the last two decades the country’s economic front has been characterised by improving the investment ecosystem to create interest from the international and local business community. The country is an emerging economy to watch, the analysis observes. Twitter: @gituram The views expressed in this article are of the author.
