South Africa’s FirstRand Group has stepped up its search for a suitable Kenyan bank after a previous deal fell through over price concerns.

Chief executive Mary Vilakazi says the group prefers a smaller lender that can be integrated with organic growth rather than buying a large local bank, and will not pay more than an asset is worth.

FirstRand is also open to non‑traditional banking assets such as insurance and investment banking to broaden its regional services.

The group’s Kenyan ambitions build on a representative office opened in 2012 to pursue infrastructure and project‑finance opportunities.

Kenya’s planned rise in minimum core capital requirements—from KSh1 billion to KSh10 billion—creates pressure on banks to raise equity or attract strategic investors, making acquisitions attractive.

Standard Investment Bank analyst Melodie Ndanu notes that tighter capital rules could improve FirstRand’s negotiating position as smaller banks seek fresh capital.

FirstRand’s search follows Nedbank’s recent acquisition of a 66 % stake in NCBA for roughly KSh110 billion, highlighting intensified competition among South African groups for Kenyan assets.

Other South African banks are pursuing varied strategies: Standard Bank favours organic growth while Absa seeks to raise its Kenyan ownership to 85 %.

FirstRand plans to redeploy proceeds from the sale of its UK motor‑finance business, MotoNovo, to fund African expansion after reporting a 5 % earnings decline for the year to June 2026.

A successful acquisition would give FirstRand a retail banking platform, deposits and regulatory infrastructure, complementing its existing corporate and investment banking capabilities in Africa.

Vilakazi stresses that any deal must meet the group’s valuation discipline and find a willing seller, underscoring commercial prudence in its East‑African expansion.