James Mwangi's Stake in Equity Bank Clocks 100 Million Dollars

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Equity Bank’s Group Chief Executive Officer and Managing Director Dr. James Mwangi saw his stake in the bank valued at US$100 Million Dollars (Kshs. 8.9 Billion) when the stock touched a high of Kshs. 49.50 during Monday’s trading at the Nairobi Securities Exchange. The stock later eased to close at Kshs. 48.00. Dr. Mwangi has a direct stake of 3.45% in the bank, which then ups to 4.88% taking into consideration his stake in the bank’s Employee Share Ownership Program (ESOP) as well as a stake in British American Investments Company (Britam).

The Equity Bank (“The Bank”) share price is up 55% so far this year buoyed by their intention to break up the mobile banking hegemony held by Safaricom. Equity, through its subsidiary Finserve Africa Limited, was awarded a Mobile Virtual Network Operator licence that will enable it to ride on existing operators’ infrastructure to offer Telco services. The strategy, labelled ‘Equity 3.0’, will according to the bank help “continue our mission of furthering financial inclusion and innovative service offerings for all Kenyans by presenting our financial services offering on a single platform which will make banking services more accessible, flexible, convenient and affordable”

In comparison, when the bank listed by introduction at the Nairobi bourse in 2006, Dr. Mwangi’s stake stood at 7.32% worth Kshs. 464 Million at the time, putting into perspective the astonishing growth experienced by Equity. At Kshs. 49.50 and taking into account the 2007 bonus (2 for 1) and the 2009 split (10 for 1), the share has appreciated by 2000% from the introductory price of Kshs. 70 per share, giving a peek of the astronomical returns enjoyed by shareholders over the past 8 years.

It is such returns that have led key management and anchor shareholders to cut their stake and, with that, reaping billions of shillings in profits. Those who have exited the Top Ten Shareholders in the rush for profits include the family of the late poultry billionaire, Nelson Muguku, former CEO John Kagema Mwangi as well as current Chairman Peter Kahara Munga.

Dr. Mwangi himself banked Kshs. 1.5 Billion in a flurry of disposals between 2009 and 2011 once the 2 year lock-in period for senior management expired. Mwangi however argued that he was not seeking to divest from the company and that his sales were only enforced by the regulator which restricted executive directors from owning more than 5% of the banks they head.

In mid to late 2013, Dr. Mwangi bought shares on the open market for the first time. He bought 152,480 shares at an average of Kshs. 32. He had previously told The Business Daily in an interview: “Mine is a perpetual investment not for trading. I am a vision investor, so people should not be expecting me to be trading my shares.” In addition to the share sales, the Group MD has also reaped a billion shillings in dividends since the conversion of the Society into a bank.

Dr. Mwangi traces his roots from Kangema village. After losing his father at an early age, he sold fruit, charcoal and milk to assist his mother make ends meet. He states that he enjoyed working hard but he also knew that his education depended on it. He has previously reminisced “it gave me great experience of selling a product and providing a service at a tender age”. In an interview with Africa Business Magazine, Mwangi cites his late mother as the biggest influence of his life. She insisted that all her children, boy or girl, went to school. After excelling in his studies, he ultimately went to secondary school on a Government scholarship. He also counts Mandela as an idol as well as business moguls Jack Welch and Steve Jobs further crediting Microsoft founder Bill Gates with awakening his philanthropic side.

Indeed, Dr. Mwangi has developed a penchant for philanthropy even going to the extent of intimating that he sees himself moving towards full time philanthropy in the future. Last year, the former accountant made a contribution of Kshs. 100 Million to Meru University of Science and Technology while he is also the biggest individual sponsor to the African Leadership Academy in South Africa where he sits on the Global Advisory Council, with donations of Kshs. 30 Million. He used his position as CEO of Equity Bank to initiate the Equity Group Foundation (EGF) which donates 1% of revenue to social causes. EGF teamed up with The Mastercard Foundation and other partners in 2010 to start the Wings to Fly Program which is an initiative to provide education and leadership training to academically gifted yet economically and socially marginalized young Kenyans.

Dr. Mwangi has won a raft of awards alongside the bank for his role in the transformation of Equity and the industry in Kenya. Most notable include:
• 2007 Global Vision Award in Microfinance which he shared with Grameen Bank’s head, Muhammad Yunus, the 2006 Bangladeshi Nobel Peace Prize winner
• 2012 Ernst and Young World Entrepreneur of the Year
• 2012 Forbes Africa Person of the Year
• 2013 Africa Investor African Business Leader of the Year

In addition to being the Chairman of the Kenya Vision 2030 Delivery Board, Mwangi also advises the United Nations Environmental Program (UNEP), The Bill and Melinda Gates Foundation, The Group of Eight (G8) leaders, as well as the Clinton Global Initiative on matters pertaining to banking the poor.


Among Dr. Mwangi’s other investments include a Kshs. 2 Billion stake in Britam and the 5-Star Enashipai Resort and Spa in Naivasha. His personal fortune is estimated to be US$300 Million Dollars.