The Kenya Commercial Bank (KCB) is set to auction 119 vehicles belonging to loan defaulters.
This is in a move that is expected to fetch the bank over Sh. 304.4 million.
Nearly all the vehicles being auctioned by KCB are trucks, tippers and prime movers, indicating that a significant number of firms in transport, trade and construction sectors are in trouble.
The seized vehicles were offered as collateral for loans, which the borrowers are now unable to repay.
Sale of the vehicles is the latest effort by KCB to clean up its books. The lender has also sought to recover billions of shillings owed by big names including collapsed construction firm Spencon and the estate of the late tycoon Tahir Sheikh Said (TSS).
Banks have recently stepped up their pursuit of a burgeoning group of defaulters in a bid to clean up their balance sheet and boost their income statements.
KCB’s gross non-performing loans stood at Sh. 33.2 billion in the half year ended June, rising marginally from Sh. 32.9 billion the year before.
The bank’s loan loss provision however declined to Sh. 2.01 billion from Sh. 2.06 billion over the same period. The lender’s net profit remained flat at Sh. 10.2 billion as a lower tax bill and reduced interest expenses cancelled out a drop in interest income and higher operating expenses.
