KENYA – KCB Group has announced that its earnings through the first six months of 2021 doubled, posting a 101 percent growth in net profit for the period to Kshs15.3 billion (US$139.7 million).
The leap in profitability from Kshs7.6 billion (US$69.4 million) at the same stage in 2020 is largely attributable to higher operating income and a reduction in overall costs.
KCB’s total operating income has for instance increased by 13.8 percent to Kshs51.2 billion (US$467.6 million) from a flat Kshs45 billion (US$411 million) in June 2020 on the back of strengthened income streams.
The lender’s net interest income increased to Ksh.36.4 billion (US$332.4 million) from Ksh.31.1 billion (284 million) while non-interest funded income (NFI) has increased by 5.7 percent to Ksh.14.8 billion (US$135.2 million).
The lender has also trimmed its non-interest-based overhead costs to Kshs29.3 billion (US$267.6 million) after cutting its loan loss provision costs by 40 percent to Kshs6.6 billion (US$60.3 million) in the period.
However, KCB’s gross non-performing loans (NPLs) have swelled to Ksh.95.7 billion (US$874 million) from Ksh.83.9 billion (US$766.2 million) in 2020.
At the same time, the Nairobi Securities Exchange-listed lender has seen its balance sheet hit Ksh.1 trillion (US$10 billion) having missed the mark at the end of 2020.
The bank now has an asset base of Kshs1.022 trillion (US$9.33 billion) which comprises Kshs607 billion (US$5.54 billion) in net loans and advances to customers.
The Group’s customer deposits have also marked a steady increase to Kshs786 billion (US$7.2 billion) from Ksh.758.2 billion (US$6.9 billion) previously.
However, KCB board of directors have not recommended the payment of an interim dividend for the period.
“Enhancing customer experiences remains at the heart of our business and we continue to boost this through the adoption of digital technologies. We also seek to build a long-term business by integrating sustainability to our business model”Joshua Oigara – CEO, KCB Group
KCB Group Chairman Andrew Kairu has termed the performance as resilient even as he expects further growth by leveraging improving macro-economic conditions across its markets.
“The outlook remains positive as economic activity normalizes across the East African region,” he said.
KCB Group Managing Director Joshua Oigara meanwhile says the bank will remain focused on enhancing customer experiences as the lender looks forward to its next phase of growth.
“Enhancing customer experiences remains at the heart of our business and we continue to boost this through the adoption of digital technologies. We also seek to build a long-term business by integrating sustainability to our business model,” he said.
Oigara further says the Group has taken the resolve to flip the devastation of the COVID-19 pandemic to its advantage as economies and firms begin to re-emerge from the global health crisis.
“Crisis gives you an opportunity for growth as we now see a positive economic outlook across the region. This for me is a sweet spot.”
KCB Group is expected to close the acquisition of Atlas Mara assets in Rwanda and Tanzania which include the acquisition of controlling stakes in the Bank Populaire du Rwanda (The Popular Bank of Rwanda) and the African Banking Corporation (ABC) Tanzania.
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