KCB half year profit has jumped by 102 per cent to a net of Sh. 15.3 billion from Sh. 7.6 billion a year ago. This KCB half year profit came as revenues increased by 14 per cent on account of higher interest income driven by an increase in earning assets and lower cost of funding.
During the period under review, assets stood at Sh. 1.02 trillion from Sh. 953 billion. Customer deposits increased by 4 per cent to Sh.786.03 billion from Sh.758.0 billion. At the same time, loans grew 9 per cent to close at Sh. 606.9 billion.
Total income increased 13.7 per cent to Sh. 51.2 billion during the period, with net interest income up by 17.7 per cent to Sh. 36.6 billion from Sh. 31.1 billion last year. This was on the back of higher interest earning assets and effective management of cost of funding during the period.
“We saw a strong first half of the year for the business with improved economic activity. The resilient and diversified nature of our business has helped us navigate the unfolding impact of the pandemic,” said KCB Group chief executive officer Joshua Oigara. “The business is well-positioned to catalyse the ongoing economic recovery as well as benefit from this resurgence.”
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Operating costs were up by 7 per cent on account of an increase in staff costs as the Group enforced cost management initiatives to ring-fence the business from the impact of the ongoing healthcare crisis. The cost of risk fell to 2.2 per cent from 4.0 per cent, with the ratio of non-performing loans (NPLs) at 14.3 per cent from 13.7 per cent in 2020. The stock of NPL closed the half at Sh. 95.7 billion, from Sh. 83.9 billion same period last year. Most of this increase occurred during the second half of last year, highlighting the strain on customers and their business because of the healthcare crisis.
“While the pandemic is still in our midst, the roll out of a vaccine globally has brought hope that the crisis will soon be under control. The resilience and providence of our concerted efforts to reinforce the sustainability of our business have enabled us to support and walk with our customers, staff and other stakeholders,” said KCB Group Chairman Andrew Kairu. “Looking forward, we believe we shall see the operating environment, and consequently our customer businesses continue to recover.”