Equity Bank Group has recorded a Ksh. 15.8 billion net profit after tax for the financial quarter ended September 30, 2018, the firm announced on Monday.
The figure represents an eight per cent increase from the Ksh. 14.8 billion net profit recorded during the same period in 2017.
According to Equity Bank Group Chief Executive James Mwangi; who was addressing a section of the press during the release of the results, the progress was accredited to higher interest income and reduced operational costs during a period characterized by volatility in the business environment resulting in elevated inflation and a lowered Central Bank Rate which dipped the yield on loans.
Similarly the bank recorded a differentiated revenue growth of 1 % to Ksh 49.3 billion up from Ksh 48.7 billion in the period under review, despite the impact interest rates cap and the challenging operating environment have had on the banking sector. Non-funded income held strong to reach Ksh.19.8 billion driven mainly by remittance commissions, trade finance, agency and credit card fees and commissions.
“Equity Group business model has proven that the Group is not dependent only on the loan book income to drive shareholder value,” Mr. Mwangi said in a statement.
“We are reaping the benefits of a strong social brand that focuses on enhancing our relationship with the community through a shared prosperity approach to business.”
The banks’ profit also rose to Ksh. 22.4 billion ($221 million) from Ksh. 20.7 billion a year earlier, while interest income rose 9 percent to Ksh.38.5 billion.
Similarly, the report revealed that the bank had made great progress in incorporating the banks’ 3.0 Strategy of digitization; that constitutes self-service tools such as Eazzy Banking, into its modus operandi with 79 per cent of all transactions under the bank being conducted under the lender’s Equitel and mobile app platforms.
Eighteen per cent of the remaining transactions were conducted via agents and ATMs while the remaining three per cent was done via the banks’ different branches.
“We currently offer our services to about 13 million customers and we believe the convenience of the digital platform is bringing in a phenomenal difference. Fintech innovation and digitization is becoming a net deposit mobilizer,” Mr. Mwangi is quoted as saying by the Business Daily.
“The region is depicting a strong economic outcome of about six per cent. This will support growth in the subsidiaries.”
Despite the improved results, Mr.Mwangi called on the government to completely eliminate the rate cap saying that ‘the recent decision by the regime to remove the interest floor on deposit, offers some reprieve but not enough to stimulate recovery in private sector growth.’