Equity Group’s net profit for the 3rd quarter grew 13.1% to KSh 40.9 billion primarily driven by an increase in operating income boosted by growth in the Tanzania and Rwanda subsidiaries.
- •Net interest income surged 11% to KSh 80.6 billion on the back of an increase in yields from investment securities while non funded income increased 5.8% to KSh 61.2 billion on increased fees and commissions.
- •The growth was however tempered by a 7.4% increase in operating expenses to KSh 90.7 billion from KSh 84.5 billion in the same period in 2023.
- •Customer deposits grew by 9% to KSh 1.3 trillion driven by growth from Rwanda, DRC and Kenya which saw deposits grow 39%, 14% and 8% respectively.
Customer loans decreased 5.4% to KSh 800.1 billion mainly driven by contracting loan books in Uganda and Tanzania subsidiaries. Gross non-performing loans increased by 0.7% to KSh 125.3 billion with the ratio increasing slightly to 13.4%, positively below the industry average of 16.7%.
Equity Group expanded its exposure to government securities by 5.4% to KSh 468.1 billion. The lender decreased the loan loss provisions by 33.2% to KSh 12.7 billion – pointing to mild optimism on the Group’s credit portfolio performance in the coming quarter.
Subsidiaries
Regional subsidiaries contributed 47% to the group’s profitability, with a combined profit after tax of KSh 18.4 billion. Collectively, subsidiaries accounted for 53% of the group revenue and 54% of pre-provisions operating profits. “Our subsidiaries outside Kenya now contribute 51% of our total profit before tax, with 48% of our balance sheet also based outside the country. EquityBCDC in DRC is playing a key role in driving this growth,” Dr. James Mwangi, Equity Group Managing Director & CEO.
Pre-provision operating expenses on the other hand soared 52% with the bulk of the cost pressures emerging from the South Sudan subsidiary, which posted a 586% growth in pre-provision expenses.
Total assets grew to KSh 1.7 trillion in the third quarter 2024 – a 0.7% expansion compared to the same period in 2023. Equity Group Holdings’ earnings per share for Q3 was KSh 10.41, a 13.5% increase from the previous year.
Equity is listed at the Nairobi bourse and is the biggest lender in Market cap. EQTY closed Monday at KSh 48.10, a 42,9% year to date gain. The company did not declare an interim dividend.