This archive report was first published on 28 November 2019.
Thursday, November 28, 2019, marked a significant turning point for Housing Finance Group, formerly known as Housing Finance Company, as it reported a 74.5% reduction in losses to Sh81.4 million in the first nine months of trading.
The remarkable turnaround was largely attributed to a near doubling of non-interest income, which rose by 78.8% to Sh1.07 billion, driven by fees and commissions on loans and advances, as well as a rise in foreign income trading gain.
Despite a marginal decline in net interest income, which fell by Sh78 million to Sh1.72 billion, the lender's bottom-line was bolstered by the increase in non-interest income. The loan book, however, shrank by Sh6.2 billion or 13.7% to Sh39.2 billion, primarily due to piling bad loans.
Gross non-performing loans (NPLs) jumped from Sh8.94 billion to Sh12.65 billion, resulting in a 64% increase in loan loss provisioning to Sh587 million. Nevertheless, the lender's efforts to reduce operating expenses, including a 17% drop in staff costs to Sh771.9 million, contributed to the overall reduction in losses.
