NAIROBI May 24 Kenya's Equity Bank Group
has closed more than half of its branches in
war-ravaged South Sudan because of a mix of hyperinflation, a
battered local currency and an economic slowdown, its chief
executive officer said.
James Mwangi, Equity's chief executive, told a shareholder
meeting the bank had closed seven of its 12 branches in South
Sudan, which has one of sub-Saharan Africa's lowest banking
"Because of uncertainty, and because of a lack of peace, we
have been forced to reduce those branches," Mwangi told
investors on Tuesday and later posted online. "I think we now
Equity follows another Kenyan bank, KCB Group,
which earlier this month said it was temporarily closing some
branches because of the tough operating environment and economic
South Sudan's three-year civil war has sharply reduced oil
output, the main source of foreign exchange, causing the pound
to plunge in value and inflation to soar to above 800 percent
"Last year, that devaluation caused us to write off a loss
of 6 billion Kenyan shillings ($58.14 million). It is not
performance; it is what you could call an economic meltdown."
The conflict erupted when President Salva Kiir fired his
deputy, Riek Machar. The violence, fanned by ethnic rivalries,
has sparked Africa's worst refugee crisis since the 1994 Rwandan
genocide and plunged part of the country into famine.
Even so, Mwangi ruled out a complete exit from the country.
"It's like hibernation - let's retain the licence until
Mwangi said an exodus of foreign workers, especially Kenyans
and Ugandans, had also hurt business.
($1 = 103.2000 Kenyan shillings)
(Reporting by George Obulutsa; editing by Richard Lough)