NBK Posts Sh87mn in Net Profit for 3Q20

NBK Posts Sh87mn in Net Profit for 3Q20

NAIROBI, Kenya, Nov 12 – National Bank of Kenya (NBK) has posted Sh87million in profit after tax for the nine months ending September 2020. This represents a 77 percent decline over a similar period last year due to effects of the COVID-19 pandemic.

The bank recorded a profit before tax of Sh535million representing a 7 percent increase over a similar period in 2019.

The corporate and retail franchises of the Bank remained resilient, amid a subdued economy and reduced activity across sectors, due to the crisis.

“These results demonstrate the Bank’s resilience, in the face of a very challenging operating environment. They have been buoyed by ongoing efforts to turnaround this institution that have however been slowed down by effects of the COVID-19 pandemic,” said NBK Managing Director Paul Russo.

Non-funded income grew by 5 percent from the previous year, on increased focus on digital banking. Interest income stood at Sh7.2billion, a growth of 9 percent due to increased volumes in loans and advances as well as sustained recoveries. Comparatively, interest expense remained relatively flat at Sh2billion.

Total operating costs increased by 14 percent, largely driven by increased provisioning to cover for higher credit risks due to the pandemic in a period that also saw the Bank continue to drive cost management initiatives.

On the balance sheet side, total assets grew by 21 percent to Sh129.5billion from Sh107billion, majorly from net loans and advances which were up 12 percent to Sh53billion. This was also supported by increased customers and deposits which grew by 24 percent to Sh102billion. Total non-performing loans and advances stood at Sh23.3billion, a 15 percent drop from Sh27billion year on year.

The Bank recorded improvements in key ratios such as the capital position. Liquidity ratio was at 47.3 percent, compared to 35.7 percent in 2019.

“We remain cautiously optimistic about the future of the bank. We continue to invest in revamping our channels and delivering an unmatched experience to our customers,” Russo added.

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