KCB customers awaiting service in one of the branches in Nairobi. [Photo/ buzzkenya.com]
Kenya Commercial Bank has announced plans to close some of its branches in war tone South Sudan pointing at devaluation of the country’s currency, unending civil war and run-away inflation that negatively affected the bank’s earnings in 2016.“KCB board of directors has approved the temporary closure of some branches in South Sudan, driven by logistical and operational challenges that have made operating some of these branches unsustainable,” the bank said.“A change in the economic situation will lead to a re-assessment of the viability of the branches.”The bank currently runs 19 branches in the Africa’s newest nation.Inflation in South Sudan hit 830 percent in 2016 and the value of the South Sudan pound fell- currently trading at 108 units against the US dollar compared to 2.95 units at which it was pegged until December 2015.The closure of the branches will apparently lead to job loses although the bank did not disclose the number of employees to be affected.“Naturally, any branch closures will lead to staff re-assessment but, as mentioned earlier, this is work in progress and we cannot therefore, at this time, quantify the number of staff who will be affected,” said the bank.KCB ventured into South Sudan in 2006 and its first branch recorded positive business results.Macro-economic problems, however, plunged the lender into a Sh759 million loss in 2016 from a net profit of Sh17.8 billion in 2015.South Sudan has been at war since 2013 after President Salva Kiir broke ranks with his deputy Riek Machar after Kiir sacked the entire cabinet.