Increased lending lifts KCB’s profit to Sh8bn
What you need to know:
- The loan book grew by 14 per cent to Sh244.01 billion compared with Sh214.09 billion in June 2013, which saw the lender increase its returns from interest income.
Kenya Commercial Bank has posted a 14 per cent after-tax profit for the half-year ending June 2014, riding on increased lending and a growth in non-funded income.
The region’s biggest bank by capitalisation recorded Sh8.17 billion profit, up from the Sh7.19 billion earned over a similar period last year.
The performance underlines the KCB’s continued dominance among Kenya’s top lenders after its main rival, Equity Bank, posted a 21 per cent profit after tax of Sh7.66 billion, up from Sh6.30 billion it had recorded for the first half of 2013.
“We are excited with the performance reflecting growth in all our business segments according to targets,” KCB chief executive officer Joshua Oigara said.
Net interest income, the amount banks earn from interest charges on loans, increased by seven per cent from Sh16.05 billion last year to Sh17.13 billion.
The loan book grew by 14 per cent to Sh244.01 billion compared with Sh214.09 billion in June 2013, which saw the lender increase its returns from interest income.
USE OF ALTERNATIVE CHANNELS
Earnings from fees and commissions grew from Sh5.04 billion in June 2013, to Sh5.67 billion in what the bank’s executives attributed to increased usage of alternative channels such as M-Benki, agency banking and strategic partnerships.
The lender said it was focusing on growing non-funded income through strategic partnerships and driving the use of alternative delivery channels.
The Kenyan arm contributed 91.6 per cent to the profitability, with the South Sudan unit defying political strife to contribute more (7.1 per cent) than Uganda, Tanzania, Rwanda, and Burundi combined.
