KCB Group posts a Ksh. 6.3 Billion net profit for the first quarter

KCB Group posts a Ksh. 6.3 Billion net profit for the first quarter

Kenya Commercial Bank Group, the biggest lender in the country has posted a net profit of Ksh. 6.3 Billion for the period ended 31 st March 2020. This represents an 8% rise in profitability from the Ksh. 5.8 Billion posted in a similar period last year.

At the same time, National Bank of Kenya (NBK) saw its profit after tax for the quarter under review rise to Ksh. 155 Million which represents a 134 per cent from a similar period last year. This was attributed to a growth in the loan book and cost management initiatives.

The rise in profitability was largely due to a 20.4 percent rise in interest income to Ksh. 20.2 Billion and a 30.5 percenta rise in transaction-based revenue to Ksh. 7.8 Billion driven by digital banking, improved foreign exchange earnings and additional income from NBK. This saw the total operating income rise by 22% to Ksh. 22.95 Billion.

During the period, customer deposits rose 34 per cent to Ksh.740.4 billion on the back of NBK’s acquisition and onboarding of new customers.

The loan book recorded a 19 per cent growth, expanding to Ksh. 553.9 Billion up from Ksh. 464.3 billion. However, NBK brought on board Ksh. 25 billion in Non-performing Loans (NPLs), which saw the stock of NPLs increased to Sh66.2 billion, up from Sh38.8 billion in 2019. This resulted in loan loss provision increasing to Ksh. 2.8 Billion.

Operating expenses surged 36.7 percent to Sh14 billion on what the lender attributed to the buyout of NBK and salary increments in the first quarter.

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