Kenya's I&M Bank buys stake in Tanzania's CFU Bank

NAIROBI, (Reuters)

Kenya's I&M Bank has entered neighbouring Tanzania by acquiring a majority stake in CF Union Bank, a two-branch lender with a staff of 57, the bank said on Monday.

It is the second time I&M, which attained full commercial bank status in 1996, has made a foray into the regional market after acquiring Bank One Mauritius in 2008.

"Trade between the two countries is increasing steadily, and our entry in Tanzania will create further opportunities to customers in both countries," said Arun Mathur, CEO of I&M.

PROPARCO, a French development financial institution, Kibo Fund, a Mauritius-based private equity fund and a prominent Tanzanian businessman were the other parties in the equity buyout, whose value was not disclosed.

I&M has a balance sheet of 45 billion shillings ($590 million) and a network of 13 branches throughout east Africa's largest economy, while its Tanzanian acquisition had a balance sheet of $61 million at the close of 2009.