KCB Group's new business venture in Rwanda pushed its net earnings for the first nine months of the year to Sh30.6 billion compared to Sh25.2 billion same period last year.
The net profit jump of 21.4 per cent is also attributed to sustained growth from both net interest and non-funded income lines.
The contribution of Group businesses, which excludes KCB Bank Kenya stood at 16.3 per cent (up from 15.2 per cent) driven by new businesses and the impact of Banque Populaire du Rwanda (BPR).
Kenya's biggest bank in terms of asset value completed the acquisition of Rwandese lender from London-listed financial services firm Atlas Mara Limited three months ago.
The group's total revenues went up 15.3 per cent to Sh92.1 billion mainly driven by the growth in non-funded income.
This increased by 30.2 per cent on higher foreign exchange earnings and lending fees.
Additionally, interest Income grew mainly from increase in our earning assets portfolio in particular loans disbursed during the period and investment in government securities.
Operating costs went up 19.6 per cent to Sh41.6 billion compared to Sh34.8 billion last year.
This was on account of the impact of BPR Bank, increased business activities and increase in staff costs. This saw the cost to income ratio stand at 45.1 per cent.
It has put in place cost saving initiatives targeting savings across all its businesses.
According to Group's CEO Paul Russo, the lender is experiencing strong revenue momentum across the corporate and retail business which positions it to meet full year outlook.
“Our focus has been on delivering value and support to our customers to help them navigate the tough economic environment”, Russo said on Tuesday.
The balance sheet expanded 13.7 per cent with total assets standing at Sh1.28 trillion largely driven by growth in loans, investment in government securities funded by growth in customer deposits and additional borrowings.
Net loans and advances surged 16.4 per cent to Sh758.8 billion from additional lending to the personal, building, construction and manufacturing sectors across the Group.
Customer Deposits increased by 7.4 per cent to Sh922.3 billion on higher deposits from the growth of current and savings accounts.
Shareholders’ funds grew by 15.2 per cent from Sh163 billion to Sh187.8 billion on improved and accumulated profits for the year to date.
The bank maintained strong capital buffers with core capital as a proportion of total risk weighted assets standing at 14.5 per cent against the statutory minimum of 10.5 per cent.
Total capital to risk-weighted assets ratio was at 18.1 per cent against a regulatory minimum of 14.5 per cent.
The board has proposed an interim dividend of Sh1.00 per share amounting to Sh3.2 billion.
