Sidian Bank increases profitability to Sh369m in Q3 2021

Sidian Bank’s improved financial performance was mainly driven by increased lending to support economic recovery.

The bank has announced their Q3 Financial results. The bank made a consolidated net profit of Sh369 million as at September 30, 2021 compared to a profit of Sh8 million as at September 30, 2020

The lender’s improved financial performance was mainly driven by increased lending to support economic recovery, especially for business owners given the challenges they have faced since 2020 from the onset of the Covid-19 pandemic.

The bank has developed strong strategic partnerships with various organisations that support its SME agenda.

The bank’s partnership with African Guarantee Fund has been instrumental in providing financing to business owners who otherwise may not access credit due to insufficient security.

The bank also has partnerships with Aqua For All, supporting customers in the Water Sanitation & Hygiene sectors and with East African Development Bank supporting Agribusiness.

Overall, the bank’s loan book grew by 17 per cent from the continued lending during the period increasing the interest income on loans and advances as well as lending fees. As-set quality continued to improve with the NPL ratio at 10.8 per cent as at September 2021 compared to 12.2 per cent as at September 2020.

A strong customer centered strategy supported by digitisation has been a key pillar in delivering the 4478 per cent improvement in profitability. The bank also focused on its digital lending platform, Q-loan, to ensure continued affordable borrowing and easy access to loans for its customers.

Increased investments in government securities further boosted interest income. Non-funded in-come increased in the period driven by Trade Finance which continues to be the flagship product of the bank, FX income as well as banc-assurance income from higher transaction volumes.

The impact of the increased incomes was, however, countered by higher interest expense from customer deposits growth.

Operating costs remained under control growing by 4 per cent as at September 2021 compared to September 2020 as the bank continues managing its cost base.

The bank’s balance sheet grew by 10 per cent to Sh37 billion as at 30 September 2021 compared to Sh33.5 billion as at 31 Dec 2020.  

Customer deposits grew by 8 per cent in the period attributed to continued deposit mobilisation as well as increased transactional business from the bank’s customers through the 42-branch network as well as digital channels.

Sidian Bank’s CEO Chege Thumbi said: “The bank’s remarkable turnaround has been as a result of the hard work of our committed and dedicated staff, pulling together to provide the best possible service and solutions to our customers. We exist because of our customers and we are grateful that they continue to choose Sidian Bank as their trusted financial partner.”