Listed tier 1 lender Diamond Trust Bank (DTB) Kenya Limited has issued a profit warning for the financial year ended December 2020.
In a statement, the bank said its earnings will be affected by the negative impact of the pandemic particularly given the impact on trade flows and the uncertainty created in the export, hospitality, real estate, aviation, tourism and agribusiness sectors.
“It is against this backdrop that the Board of Directors wishes to announce that DTB’s earnings for the current financial year are expected to be substantially lower than the earnings reported for the same period in 2019, based on its projected full-year financial forecasts. This is primarily due to an increase in impairment provisions in light of the COVID-19 pandemic as well as an increase in restructured and delayed loan repayments as the COVID-19 impact on customers intensified during the year.” DTB said in a statement to shareholders.
Other Kenyan lenders that issued profit alerts include; Absa Bank Kenya Plc, Standard Chartered Bank Kenya, KCB Group, I&M Holdings, and HF Group.
DTB Q3 2020
Diamond Trust Bank reported a 28% y.o.y drop in net profit in the nine months that ended on 30th September to KSh 4.3 billion. The drop was largely driven by a 232% increase in loan loss provisions which moved to KSh2.9 billion from KSh870 million in the third quarter of 2019.
On the positive side, the bank noted that it is participating in the Credit Guarantee Scheme for Micro, Small and Medium-Sized Enterprises (“MSMEs) which is sponsored by National Treasury intended to ease access to credit for MSMEs.
READ; Credit Guarantee Scheme for MSMEs Receives Cabinet Approval