KCB profit rises to Sh19.2 billion

[ad_1] Companies KCB profit rises to Sh19.2 billion on high income Thursday, November 14, 2019 7:49

By PATRICK ALUSHULA KCB chief executive Joshua Oigara. FILE PHOTO | NMG KCB Group’s #ticker:KCB after-tax earnings for the first nine months to September grew 6.2 percent to Sh19.2 billion supported by increased interest and non-interest income. The performance, from a previous period’s Sh18 billion, was also driven by cost management, helping the bank stay ahead of its closest rival Equity #ticker:EQTY which announced Sh17.5 billion profit on Tuesday. “We had a strong quarter and the business witnessed growth across various segments. We made continued strong investments in our capabilities to serve customers better,” KCB chief executive Joshua Oigara said. “The international businesses have continued to improve while our digital offerings are witnessing increased activity.” Subsidiaries’ after-tax profit increased eight percent to Sh1.3 billion. Of the four subsidiaries, only the Ugandan operations returned a loss. advertisement Group net interest income expanded seven percent to Sh38.7 billion supported by a 12 percent growth in loan book to Sh486.4 billion even as cost of funds reduced. The loan book expansion was mainly from retail and corporate customers. KCB received an additional Sh60 billion customer deposits to close at Sh586.7 billion. However, interest expense dropped by 0.8 percent to Sh12.76 billion showing access to cheaper source of funding. Non-funded income rose 16.9 percent, largely supported by fees and commissions which increased 28 percent to Sh14.1 billion on diversified income streams. Loans disbursed under KCB M-Pesa platform quadrupled to Sh98 billion from last year’s Sh23 billion. Other operating expenses, mainly from staff costs and provisioning for non-performing loan (NPLs) rose 13.4 percent to Sh32.48 billion. This came in the period provisioning for bad debts tripled to Sh5.84 billion while staff costs rose 6.2 percent to Sh13.57 billion. The NPLs had a higher impact on costs since pre-provisioning costs were at Sh26.6 billion, lower by 1 percent from previous period costs. Gross NPLs jumped 22.4 percent or by Sh7.8 billion to Sh42.58 billion. This saw NPLs ratio shoot to 8.3 percent. However, this is still below the industry average of 12.6 percent. The lender expects acquisition of National Bank to cement its position in the domestic market. [ad_2] Source link