Kenya’s Equity Bank Group said on Thursday strong growth in its mobile banking business would help offset the country’s cap on lending rates, after posting an 18 percent rise in its January-September pretax profits.
The government in the East African nation capped commercial lending rates at 4 percentage points above the central bank’s lending rate in September, spooking foreign investors, who sold off bank shares.
Equity’s pretax profit rose to 21.5 billion shillings ($211.8 million) in the first nine months of this year as net interest income surged by a third.
Equity also offers mobile phone banking, including lending, through its subsidiary Equitel.
Chief Executive Officer James Mwangi told an investor briefing the volume of loans disbursed on its mobile platform had leapt to 30 billion shillings ($300m) at the end of September from 1.6 billion shillings ($16m) in the same period in 2015.”I think that it has had significant reward (for) the bank,” Mwangi said.The bank also said it expected growth in deposits to continue at a double digit percentage rate.”Digitisation and launch of Eazzy pay and Eazzy Biz are likely to have current account and transaction floats (volumes) increase significantly,” it said in a statement