Tier 1 lender KCB has seen its profits in the first six months of the year increase by five percent to Ksh. 12.7 billion up from Ksh. 12.1 billion registered in a similar period last year.
According to the bank’s Chief Executive Officer Joshua Oigara, the significant increase in its net profit in the period under review was as a result of effective cost management, the lender’s loan book growing and increased activity on its mobile money channel.
In the period under review, the bank’s loan book grew by 13.8 percent to Ksh. 479 billion from Ksh. 421 billion recorded in a similar period last year while retail, corporate and mortgage loans grew by 12, 10 and five percent respectively. Similarly channel transactions done outside the branch increased to 96 percent of total transactions, up from 87 percent in 2018 driven by the bank’s mobile channels. Fees and commissions increased by 31 percent to Ksh. 8.9 billion as revenues from digital channels in particular KCB M-PESA grew significantly powered by the new platform launched late last year.
“We had a strong second quarter and witnessed continued growth across our business segments. The investment in technology generated a positive return and further helped drive efficiency and deepen access to affordable financial services in all markets,” KCB’s Group CEO said Thursday during the release of the results at Serena Hotel in Nairobi.
On his part, KCB Group’s Chief Finance Officer Lawrence Kimathi attributed the growth of the firm’s net profit to a jump in the lender’s loan loss provision kitty spearheaded by a lack of one off benefit passing non-performing loans (NPLs) through balance sheet as was the case last year.
The lender’s first half of the year results puts it ahead of rival tier 1 bank Equity Group which registered a 11.92 billion net profit in the first six months of the year. Following the good performance, shareholders at the bank will receive an interim dividend of Ksh. 1 per share in November 2019.
ALSO READ: Kenya’s KCB Group to boost investments in South Sudan
