The bank’s net profit in the six months to end of June stood at Sh8.5 billion compared to Sh7.6 billion a year earlier, placing it second after KCB whose net profit rose to Sh9.2 billion (13 per cent) in the period from Sh8.1 billion.

Equity’s interest income rose 13.5 per cent to Sh19.2 billion while income from transactions and other fees increased 30 per cent to Sh10.8 billion. The bank’s core lending business benefited from a 26.9 per cent increase in the loan book to Sh236.8 billion.

Equity’s lending capacity got a boost after global institutional investors, including the US development finance institution OPIC, committed to provide it with Sh52.5 billion for onward lending to youth, green energy investors and other groups.

Its operating expenses jumped 22.3 per cent to Sh14.2 billion, partly attributed to the firm’s heavy spending on information communication technology (ICT) in the period.

“Total expenses grew … on the back of costs associated with the strategic investments recently made to enhance the group’s enterprise resource planning capacity,” said CEO James Mwangi after releasing the results.

He further elaborated that the ICT investment was aimed at creating a robust infrastructure that converged banking, telecommunications channels and products besides fully digitising the bank’s operations.

Equity launched its mobile banking service Equitel in January as part of its strategy to grow its delivery channels beyond ATMs and Internet banking. It had signed up one million Equitel users as of June, doubling the half-a-million subscribers it had in the first month of operation.

The bank sees mobile banking as an important value-add that also serves to cut costs by eliminating the need for customers to visit banking halls for ordinary transactions like withdrawals and cash transfers.

The value of mobile banking transactions stood at Sh42.3 billion in June, rising nearly eight times from Sh5.4 billion in January. The volume of the transactions increased nearly seven times to 77.7 million from 11.3 million in the same period.

Mr Mwangi said loan disbursements through mobile banking rose steadily to peak at Sh2.4 billion in value and 623,171 in volumes in June.

Equitel took a 1.9 per cent market share in Kenya’s mobile subscriptions in the first quarter, ranking fourth after Safaricom (67.1 per cent), Airtel (20.2 per cent) and Telkom Kenya (10.8 per cent).

Besides mobile banking, Equitel offers telecommunications services through a partnership with Airtel as a mobile virtual network operator (MVNO).