Family Bank Issues Profit Warning, Posts Q3 Loss of Sh743 million; Blames Drought!!!

Mr David Thuku Family Bank Kenya MD
Mr David Thuku Family Bank Kenya MD

Family Bank Kenya has issued a profit warning saying earnings for the full year period ended 31st December will fall by more than 25% compared to the previous year.

The warning comes at a time when the bank announced a loss of Sh 743 million for the first nine months of the year compared to a profit of Sh 963 million reported in a similar period last year.

As expected, the bank blamed the impact of interest rate cap law introduced last year, harsh economic environment due to a prolonged electioneering period and even went ahead to blame drought experienced earlier in the year.

The lender’s total interest income fell by 43% to Sh 4.9 billion compared to Sh8.7 billion in Q3 2016. Loans & advances to customers decreased to Sh44.4 billion as interest income dropped 43 percent to Sh4.9 billion from Sh8.7 billion in 2016. Income from loans & advances to customers fell by 45% as operating income fell by 34% to Sh 4.8 billion from Sh7.3 billion.

Gross Non Performing loans for the period increased from Sh6.4 billion to Sh8.2 billion.