Factors influencing the regional growth strategy of the Kenya commercial bank Limited

Abstract

The objective of this research was to establish the regional growth strategy that KCB is pursuing, reasons for the growth strategy and highlight the factors that have affected strategy. The study was case based and utilized both primary and secondary data collected from the bank's staff and documents respectively. The study targeted all the managers in the Strategy and Change Division of KCB and all the mangers who have been to the various regional markets to undertake feasibility studies. The data was collected with the help of structured questionnaires. The data was analyzed using Statistical package on Social Sciences with the help of descriptive statistics i.e. frequencies, mean scores and standard deviations as well as content analysis. Major findings show the strategy being pursued by the bank is market development and the preferred mode of entry is registration of fully owned subsidiaries and mergers and acquisitions. The reasons for KCB's regional growth strategies are attractive regional market, desire to follow competition and customers, grow market size, inducement by host Governments, reduction of operational costs, desire to boost corporate image, answer needs, namely reconstruction of formerly devastated infrastructure and meet the demand for.•banking services, take advantage of harmonized tax regime, tap new opportunities, leverage on the regional integration and free trade frontiers, to stay ahead of competition, and grow shareholder value. The study found out that factors that have affected the regional growth strategy are tough expatriate workers' policies, low labour quality, legal complexity, delay in processing of licenses, fragility of the legal and regulatory framework, poor infrastructure, inferior brand perception, high cost of doing business, high staff turnover, uncertainty in peace agreements, political risks and suspicions.