Absa ends its decade-long ownership of First Assurance in Sh3 billion buyout
Absa Bank Kenya’s bancassurance business generated KSh1.3 billion in net profit in 2025, growing 35% from the previous year. The performance provides an important commercial backdrop to Absa Group’s completed KSh3 billion sale of its controlling interest in two Kenyan insurance companies, as the group retains its distribution relationship with the businesses under their new ownership.
The disposal ends Absa’s direct ownership of First Assurance Company Limited and Absa Life Assurance Kenya, whose operations will continue under the names First Assurance General and First Assurance Life, respectively. First Assurance Investments announced that it had completed the acquisition of Absa’s entire 63.32% shareholding after receiving regulatory approval.
The arrangement allows Absa Bank Kenya to continue distributing insurance products through its existing relationships with the two companies even after their ownership changes. First Assurance Investments said the distribution arrangements would continue, alongside a collaborative transition intended to avoid disruption to the insurers’ operations.
Absa keeps its insurance distribution business after the sale
The distinction between owning an insurance company and distributing its products is central to the transaction. Absa is relinquishing its direct interest in the businesses underwriting insurance policies while retaining access to the Kenyan banking customer base through its bancassurance operation.
The KSh1.3 billion net profit recorded by Absa Bank Kenya’s bancassurance business in 2025 highlights the financial importance of that arrangement. The 35% annual growth also contrasts with the performance of Absa Life Assurance Kenya, whose net profit declined by 26% to KSh790.1 million during the same financial year, according to earlier TechTrendsKE reporting.
Absa’s banking subsidiary can therefore continue earning from insurance distribution without holding direct ownership of the companies providing the underlying insurance products. The model also fits the bank’s wider efforts to grow non-funded income through services that generate fees and commissions alongside traditional lending.
First Assurance Investments said existing distribution relationships with Absa Bank Kenya PLC would continue following the acquisition. The company added that the transaction involved a supportive and collaborative process to maintain continuity across the two insurance businesses.
Local investors take control of two established insurers
The completed transaction returns the insurance businesses to an investment vehicle connected to their earlier ownership. First Assurance Investments acquired Absa’s 63.32% shareholding for KSh3 billion, bringing an ownership arrangement that began in 2015 to an end.
The two companies will adopt new identities following the transfer. Absa Life Assurance Kenya becomes First Assurance Life, while First Assurance Company changes its name to First Assurance General. Both will retain the designation “formerly an Absa Group Company” for six months as they transition away from the Absa identity.
The businesses have established positions in their respective segments of the Kenyan insurance market. Insurance Regulatory Authority data showed that Absa Life Assurance Kenya was the country’s seventh-largest life insurer, with a 4.9% market share at the end of June 2026. First Assurance Company ranked 14th among general insurers.
The acquisition gives the local investment vehicle control of both businesses and restores the First Assurance identity across their life and general insurance operations.
Mudavadi and Timamy-linked companies behind the acquisition
First Assurance Investments is owned by two corporate entities connected to Prime Cabinet Secretary Musalia Mudavadi and Lamu Governor Issa Abdalla Issa Timamy.
Public registry records show that Syndicate Nominees owns 52.5% of First Assurance Investments. Mr Mudavadi said during his vetting for the Prime Cabinet Secretary position in 2022 that he owned the company. Exclusive Holding Limited holds the remaining 47.5%, with Mr Timamy owning a 30% stake in that investment vehicle.
The transaction reverses the 2015 acquisition in which Absa, then operating as Barclays Africa, purchased a controlling stake in First Assurance for KSh2.2 billion. The latest KSh3 billion buyout returns control to an investment structure linked to the investors who previously sold their controlling interest to the financial services group.
Absa’s African insurance strategy favours partnerships
The Kenyan disposal forms part of Absa Group’s wider decision to reduce direct ownership of insurance underwriting businesses across its African operations. The group has pursued similar disposals in Botswana, Zambia and Mozambique as it adopts a model built around bancassurance partnerships.
In its 2025 annual report, Absa said it had moved towards a distribution model involving key insurance partners across its African markets. The arrangement allows the group to participate in insurance distribution without retaining direct ownership of the companies underwriting policies.
The strategy gives Absa a way to maintain insurance-related business through its banking network while reducing its direct exposure to insurance ownership. Its Kenyan bancassurance earnings demonstrate the scale of the distribution business that remains after the sale.
The decision also comes as Absa commits additional capital to its Kenyan banking operations. In a separate KSh30.9 billion transaction, the group is seeking to increase its ownership of Absa Bank Kenya from 68.5% to 85%, reinforcing the distinction between its investment in banking and its decision to relinquish direct ownership of the two insurance businesses.
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