KCB Half Year Results 2019: Kenya’s biggest bank KCB Group has posted a five per cent net profit growth for the first six months of the year.
The bank’s profit has hit Sh. 12.7 billion. The growth came in tandem with a five per cent rise in interest income which stood at Sh. 25.4 billion. In the same vein, non-funded income grew by 15 per cent to Sh. 13.2 billion.
The growth in interest income was mainly driven by a 13.8 per cent growth in loan book, which pushed up interest on loans and advances to customers to Sh. 479 billion from Sh. 421 billion. Retail loans grew at 12 per cent while corporate and mortgage grew at 10 per cent and five per cent respectively.
“The improvement in earnings from Sh. 12.1 billion reported same period last year is attributable to growth in loan book and increased mobile channel activity. Prudent cost management further supported the performance in a relatively tough business environment,” said KCB Group CEO and Managing Director Joshua Oigara while releasing the KCB half year results 2019 on Thursday.
Following these results, KCB shareholders are set to earn an interim dividend of Sh. 1.00 per share. This interim dividend will be paid in November this year.
“The bottomline was impacted by 266 per cent jump in loan loss provision from Sh. 0.8 billion to Sh. 3 billion. This is something we are looking at keenly to deliver a robust second half performance,” KCB Group Chief Finance Officer Lawrence Kimathi said.
Mr. Kimathi further said that the jump was as a result of absence of one off benefit of passing non performing loans through balance sheet as was last year during transitioning to new accounting standard.
During the six month period, the Central Bank of Kenya kept benchmark lending rates for the sector at nine per cent meaning no commercial loan was priced higher than 13 per cent.