Barclays Bank of Kenya reported a modest rise in earnings for the nine months ended September 2018, with net profit increasing 1.9 per cent to Sh5.4 billion. The result, published on Wednesday, November 21, 2018, was the weakest profit growth among the lender’s first-tier peers.
The bank, which had recently separated from its former parent, UK-based Barclays Plc, said total interest income grew 7.6 per cent to Sh21.6 billion. It also benefited from cost controls that reduced staff costs by 7.9 per cent to Sh7.5 billion.
Those savings followed redundancies in the previous financial year, after which Barclays shut 12 branches and ended the year with 89 outlets, most of them in Nairobi. Its workforce also fell to 2,268 employees from 2,591 in 2016.
Despite the lower staff bill, operating expenses rose 8.3 per cent to Sh16.13 billion, outpacing the 5.5 per cent increase in operating income to Sh23.85 billion. That pressure helped limit the bank’s overall earnings momentum.
Customer deposits climbed 10 per cent to Sh220 billion, with transactional accounts making up 66 per cent of the total. Barclays linked part of that growth to new products it had introduced in the market.
The lender also said it had expanded its Enterprise Supply Development fund to Sh500 million the previous month after a pilot programme that ran for more than a year. The facility is meant to finance SMEs that supply goods and services to corporate firms on the basis of valid contracts.
Its performance lagged behind several rivals at the same stage of the year. Co-operative Bank reported a 8 per cent rise in third-quarter net profit to Sh10.3 billion, Equity Bank posted an 8.1 per cent increase to Sh15.8 billion for the first nine months of 2018, and KCB recorded a 19.6 per cent jump to Sh18 billion in net profit over a similar period.
