Absa Kenya's nine-month profit up 20% to Sh14.7Bn
Absa Bank Kenya Chief Finance Officer Yusuf Omari and Managing Director and CEO Abdi Mohamed during a recent release of financial results.
Absa Bank Kenya PLC has reported a 20 percent increase in net profit KES14.7 billion for the third quarter ending September 30, 2024. The Pan-African lender is attributing the strong performance to solid performance across multiple business segments, which the bank has been targeting.
For the nine months, Absa Bank Kenya’s loans and advances increased to KES311 billion, with new gross lending of KES94 billion directed towards critical sectors of the economy.
"We continue to diversify our revenue sources by enhancing payment solutions, improving customer experiences, and promoting financial inclusion through digital finance, affordable housing, and SME-oriented products such as Wezesha and Microinsurance,” Absa Bank Kenya Managing Director and CEO stated.
Loan loss provision
However, the provision for loan losses edged up by 19 percent to KES8 billion compared to the same period last year, reflecting a challenging operating environment where businesses and individuals struggled to meet tough credit terms from lenders.
Absa's revenues went up by 16 percent, hitting KES 46.8 billion bolstered by funded income which closed the period at KES34.5 billion. At the same time, non-funded income grew by 13 percent to KES12.2 billion.
Absa said its strong growth in revenue highlights both the solidity of legacy revenue streams and the rapid expansion of new income sources, including asset management and brokerage.
Customer deposits increased slightly to KES352 billion, illustrating sustained confidence in Absa as a primary financial partner.
In the review period, the Bank expanded its service touchpoints, increasing its agency network from 600 to over 3,000 locations. To further enhance customer value, Absa enhanced its La-Riba service to provide innovative Shariah-compliant solutions while reinforcing its Wezesha Stock platform for SMEs.
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Technology upgrade
Additionally, the Bank accelerated the ongoing implementation of a KES3 billion technology upgrade strategy to strengthen its core banking and back-office systems.
Moreover, the Bank has intensified its sustainability initiatives by establishing the Absa Kenya Foundation (AKF), which will amplify its positive community impact and sustainability commitments. The Foundation will prioritise four key areas: enterprise development, education and skills, natural resource management, and health and humanitarian relief.
Looking forward, Mr. Mohamed stated, " This strong outcome demonstrates the effectiveness of the Bank’s growth strategy and its dedication to providing both financial and non-financial solutions that address the diverse needs of individuals, businesses, and communities.
"As we look ahead, we are confident that with prudent management, we can leverage these opportunities and continue to support our customers’ and other stakeholders’ ambitions, consequently driving our own growth.”
