KCB Group's customer deposits fell by Sh34.2 billion in nine months period through September, the lander reported yesterday, blaming devaluation of South Sudan's currency.
The country's largest lender by market share said group's deposits stood at Sh436.8 billion in September 2016, a seven per cent drop from Sh471 billion a year earlier.
KCB Bank Kenya deposits, however, posted a growth of 14 per cent as a “result of customers seeking to place their money where they felt safe”, chief executive Joshua Oigara said.
"The pressure on the South Sudan pound has continued to grow since December 2015 when the currency was floated. But there has been a continued resilience in other six markets that we operate in," he told an investor briefing yesterday.
The group's total assets also declined from Sh607.25 billion in September 2015 to Sh570.10 billion this year, but Oigara was optimistic the asset book would bounce back to steady growth as the bank makes investment in technology systems and digital platforms.
The financial statement showed strong growth for Kenya, largely helped by prudent cost management initiatives.
This helped push up net profit by 15 per cent to Sh15.94 billion from Sh13.92 billion the year before, helping it stay ahead of fierce rival Equity which posted Sh15.1billion in the same period after an 18 per cent growth.
Net interest income rose 27 per cent from Sh28.4 billion to Sh36.1 billion after net loans and advances increased by five per cent from Sh347.5 billion to Sh364.5 billion.
Oigara said loans processed via mobile phones hit an average of 80,000 per day in September.
"The success of our mobile platforms has enabled the bank to process up to 91 per cent of out total loan transactions in the past nine months," he said.
The lender's provisions for bad debt dropped 11 per cent from Sh3.8 billion to Sh3.4 billion helped by enhanced recoveries, upgrades and credit processes.
Oigara said the bank is counting on the power of technology, particularly mobile phones, in a bid to drive the future business.
"Digital banking is where the centricity of our customers has gone to in the past few years," he said.
The lender has operations in Kenya, Uganda, Tanzania, Burundi and Rwanda.