14/09/2010 Sizwe Nxasana CEO of FirstRand during their results presentation at Sandton JHB. Photo: Leon Nicholas

Johannesburg - South African lender FirstRand invested $400 million in Ghana last year, and is re-evaluating the business case for opening operations in Kenya, its chief executive said.

The continent's second-biggest bank by market value has scaled back its presence elsewhere across the globe to narrow its focus on Africa, where it already has businesses in countries such as Nigeria, Zambia, Mozambique and Tanzania.

“We are doing a bit of market analysis ... to decide whether we want to get into Kenya, especially given that M-Pesa has captured the bulk of the retail market there,” chief executive Sizwe Nxasana said, referring to the popular mobile money service.

“So we are trying to just figure out how do you make money in Kenya.”

Nxasana told a forum late on Tuesday that the Ghana funds went into agriculture, mining and real estate.

FirstRand was now applying for a banking licence in the country.

The money was a combination of its corporate and investment unit's lending and property-related investment through third party funds as well as the bank's money.

FirstRand currently has a representative office in Kenya, which it set up in 2012 initially to book infrastructure and project financing deals and to scout for an acquisition.

FirstRand hoped Kenya's position on the continent's east coast would allow it to make a play for the fast-growing Africa-India trade corridor. The bank also has an Indian retail business, operating in poor Mumbai neighbourhoods.

Because of overstated valuations in Africa, FirstRand now prefers to set up operations elsewhere on the continent from scratch, instead of making large acquisitions.

In 2011, it walked away from a bid for Nigeria's Sterling Bank after the parties failed to agree on valuation.

It also abandoned talks to acquire a majority stake in Merchant Bank Ghana for over $90 million last year.

In Zambia, a change in the government in 2011 scuppered FirstRand's agreement to buy Finance Bank. - Reuters