KCB Group net earnings rise 69% to Sh16.5Bn
KCB Group has announced strong growth in net earnings in the three-month period to March, with profit increasing by 69 percent to Kes16.5 billion attributable to higher income. The bank saw total interest income expand by 46 percent to Kes49 billion even as operating income went up by 31.6 percent to Kes48.5 billion.
Group CEO Paul Russo termed the results historic, adding that they were as a result of strong revenue growth across the bank’s regional network effectively pushing the balance sheet to Kes2 trillion, from Sh1.6 trillion as at March 2023.
“We are particularly excited about the strong potential that we see in our pipeline, as well as the increased traction that both our growth engines and the synergies across the group. These factors set the stage for accelerated revenue growth as the year progresses,” KCB Group CEO Paul Russo noted.
KCB Group, which also has a presence in the Democratic Republic of Congo (DRC), Tanzania, Rwanda, South Sudan, Uganda and Burundi, said pretax profit rose to Kes21.16 billion from Kes13.85 billion realised during a similar period in 2023.
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Subsidiaries’ performance
“Our growth has been balanced throughout the region with key growth assets being KCB Bank Kenya, Uganda, South Sudan and TMB,” Chief Finance Officer Lawrence Kimathi highlighted.
During the three-month period, businesses outside KCB Bank Kenya accounted for 17.9 per cent of pre-tax profits and 13.1 per cent of the Group’s total assets.
Russo added, “KCB is well positioned to power the strong projected GDP growth across the region in 2024, driven by agriculture, tourism and services sectors.”
In the quarter, Group loans portfolio grew at 12.2 percent to Kes1.13 trillion, driven by additional lending to support business in trade, tourism and manufacturing sectors as well as credit to households.
In the quarter, the bank increased its provision for loan losses by 53.4 percent to Kes6.3 billion as it experienced 18.2 percent rise in non-performing loans which closed the quarter at Kes205 billion as borrowers defaulted on loans owing to the prevailing high interest rate regime in the country.
Mr Kimathi noted that the increase in non-performing loans was attributed to downgrades in the Kenya business as well as the impact of foreign currency translations.
Overall, shareholders’ funds grew by 11 percent in the period to Kes238.6 billion, up from Sh214.8 billion realised in March 2023.
