Victoria Commercial Bank has injected an additional Sh20.08 million into Montessori Learning Centre, a Nairobi-based kindergarten facing financial difficulties. This latest investment follows a 2021 debt swap deal where the bank acquired a 24.9% stake in the school after it defaulted on a Sh200 million loan.
Despite the new investment, Victoria Bank maintains its ownership stake. Montessori, however, suffered significant losses in 2023, with a net loss exceeding Sh93 million. Victoria’s share of this loss amounted to Sh23.37 million.
This deeper involvement in a non-financial institution is uncommon for a bank in Kenya. Central Bank regulations typically restrict such ownership. However, exemptions exist for debt swap deals involving struggling borrowers.
Founded in 1998, Montessori offers a British curriculum for kindergarten and preparatory school. The school’s financial woes raise questions about its long-term viability. Victoria Bank, on the other hand, has enjoyed steady growth, marking its third consecutive year of rising profits.
