I&M profit flat at Sh4.6 billion as bad loan cover rises
I&M Group net profit for the nine-month ended September closed flat at Kes4.6 billion attributable to the lender’s move to raise provision for non-performing loans to Kes2.7 billion from Kes1.9 billion at a similar period last year.
The rise in the loans default cover has offset a 17 percent jump in total operating income to Kes16.5 billion from Ksh.14.1 billion previously.
In the period, I&M Group customer deposits grew by 14.18 percent to Kes 288.68 billion while the loan book posted an 11.80 percent uptick to Kes207.61 billion.
Further, I&M’s net interest income hit Kes11.4 billion from Kes8.6 billion in September 2002 from a lower cost of funds countering a 10.7 percent decline in non-funded income (NFI) that closed at Kes5 billion.
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Third-quarter disclosures show that the lender’s cost to income ratio worsened to 33.06 percent mainly on the back of digitization costs as most nonbanking activities are still in the investment phase.
The CTI increase was occasioned by faster growth in the Group’s total operating expenses by 28.68 percent year on year to Kes 12.22 billion compared to a 19.89 percent growth in total operating income.
The lender has not declared an interim dividend ahead of the close of its financial year next month.
