Equity Holdings’ net profit for the year 2020 fell by 11% as the lender suffered from the effects of the covid19 pandemic. The bank’s full-year net profit decreased to KSh20.1 billion in 2020 from KSh22.6 billion in 2019, largely driven by a sharp rise in loan loss provisions. In 2020, Equity set aside KSh26.6 billion to cover loan losses, a huge increase from the KSh5.3 billion set aside in 2019.
Bad loans rose to KSh59 billion in 2020, from KSh36 billion in 2019, a 64% increase.
The bank’s total operating income grew by 23.6% from KSh75.8 billion in 2019 to KSh93.7 billion last year, off-setting the big increase in loan loss provisions. Net interest income rose 23% to KSh55.1 billion while non-interest income jumped 25% to KSh38.5 billion.
The region’s largest bank by customer numbers increased its customer deposits by 53% to KSh740.8 billion at the end of 2020, after it acquired 66.5% ownership in the second-largest commercial bank in the Democratic Republic of Congo, Banque Commerciale Du Congo (BCDC) in August last year. Loans and advances to customers grew to KSh477.8 billion from KSh366.4 billion in 2019, a 30% increase.
The bank’s total assets rose 51% to KSh1.015 trillion while total liabilities jumped 56% to KSh876 billion.
Equity Bank benefitted from its digital transformation with 63% of the total transaction value generated from outside the branch network, an improvement from 51% in 2019. 98% of the transactions were done outside the branch network and only 2% were done inside the banking halls.
The bank’s board of directors did not recommend a dividend for the year 2020.