KCB group has posted
a net profit of Sh12.1 billion in the half year to June in a marginal improvement
from last year when the company posted Sh10.3 billion.
Profit
after tax for the first six months represents a 18 per cent growth, reinforcing the lender’s
solid growth prospects.
While releasing the results on Thursday, CEO Joshua Oigara, said the business was resilient in a rough
operating environment further complicated by credit tightness in key
markets.
“We are on track to delivering on our 2018 targets in the six strategic initiatives. We are seeing a more robust business..."
Oigara said.
Total income for the bank rose three per cent to Sh35.6 billion from Sh34.6 billion, riding on a surge in both interest and non-interest income.
Operating expenses declined seven per cent to Sh18.5 billion from Sh19.9 billion attributed to improved staff costs and loan loss provisioning.
Transaction activity continued to shift away from branches, with non-branch transactions standing at 87 per cent of total volumes.
This is compared to 13 per cent handled at the branches.
During the period, KCB balance sheet grew six per cent to Sh667.7 billion from Sh 630.6 billion, driven by higher deposits and gross customer loans in an environment of controlled interest rates.
Deposits hit Sh525 billion from Sh482.8 billion, resulting in an improved liquidity position.
The loan book expanded four per cent to Sh421.5 billion.
"We foresee strong growth on an improved macroeconomic environment, especially in Kenya, and expect improved investor confidence in South Sudan on the back of the newly signed peace agreement,” Oigara said.
Following the results, the board of directors approved a payment of an interim dividend of Sh1.00 per share. Shareholders will be paid the dividend in November 2018.
KCB Group’s full year net profit for 2017 stagnated at Sh19.7 billion on political uncertainty in East Africa, the interest cap regime in Kenya and high restructuring costs.
The regional lender, however, defied the tough economic environment to push its operating income to Sh71.4 billion during the year under review compared to Sh69.5 billion in 2016, while its net interest income rose three per cent to Sh48.4 billion up from Sh47 billion.