Equity Group Holdings Plc has posted an increase of 85% in Pre-tax profit to KSh 36.6 Billion in the third quarter period ended 30th September 2021. This is compared to a Pre-tax profit of KSh 19.7 Billion in the same period in 2020.
The lender saw its net earnings increase 79% from Ksh 15.0 Billion to Ksh 26.9 Billion. The bulk of this growth came from its subsidiaries with total assets recording a growth of 27% and a 25% growth in total income, Dr James Mwangi, the Managing Director told an investor briefing this Monday while releasing the Q3 financials.
Dr Mwangi also noted that regional subsidiaries grew their group contribution to deposits to 42% up from 40%, revenue to 37% up from 30% and profit before tax to 26% up from 21%.
The lender’s profitability-as measured by Earnings per Share (EPS) also improved significantly quarter on quarter from KSh 4.65 in Q2, 2021 to KSh 6.98 in Q3, 2021.
Equity Group saw its balance sheet size grow to KSh 1.2 Trillion in Q3 2021 compared to KSh 1.1 Trillion at the end of the period ended 30th June 2021. Net loans to customers increased from KSh 504 Billion to KSh 559 Billion between June and September while customer deposits rose from KSh 819.7 Billion to KSh 875.1 Billion during the period under consideration.
Total interest income from loans, investment in government paper as well as earnings from deposits with other banking institutions, increased from KSh 42.7 Billion in Q2, 2021 to KSh 67 Billion at the end of September this year. The Group’s earnings from fees and commissions on loans to customers nearly doubled from KSh 3.5 Billion to KSh 5.7 Billion between June and September 2021.
Income from foreign exchange trading activities increased from KSh 4.1 Billion in June to KSh 5.6 Billion at the end of September 2021, bringing total non-interest income from fees and commissions on loans and forex trading as well as other income to KSh 31.9 Billion in Q3 from KSh 20.8 Billion in Q2, 2021.
The Group’s operating expenses, however, went up significantly from KSh 28.1 Billion in Q2 to KSh 43.8 Billion in Q3, pushed up by rising staff costs due to recent acquisitions in the region, the latest being in the Democratic Republic of Congo (DRC).
With Kenya’s economy in a recovery mode from the effects of COVID-19 pandemic, the level of non-performing loans is getting lower for most lenders.