Family Bank, a middle tier lender, has shrugged a challenging business environment posed by the COVID-19 pandemic to post a 70% increase in Net Earnings to KSh 1.1 Billion at the end of the nine months ending 30th September, 2020. This is compared to a Net Profit of KSh 704.6 Million recorded over a similar period last year.
Family Bank’s profit before tax(PBT) also rose from KSh 1 Billion to KSh 1.5 Billion during the period under review. The balance sheet size increased from KSh 78.9 Billion to KSh 90.2 Billion at the close of Q3, 2020.
According to Family Bank CEO Rebecca Mbithi, the lender’s focus has been how to support its customers to survive adverse effects of the pandemic.
The lender has restructured loans and issued moratoriums to financially distressed borrowers, offering free transfers on its digital platforms and supporting small businesses.
She said Family Bank was pleased to have managed this pandemic effectively while being able to increase its income in such times of uncertainty.
While loans to customers was up from KSh 49.3 Billion to KSh 57.1 Billion, fees and commissions earned by Family Bank from these loans were down from KSh 99.7 Million to KSh 97.1 Million during the period under review.
The lender increased provisions against potential loan losses, to cushion its balance sheet, from KSh 572.4 Million to KSh 866.1 Million.
Interest income from loans to customers was up from KSh 4.4 Billion to KSh 5.4 Billion while the lender’s deposits grew from KSh 60.2 Billion to KSh 69.4 Billion.
Earnings per Share(EPS), a measure of the firm’s profitability increased to KSh 0.87 in Q3, 2020 from KSh 0.55 at the end of Q3, 2019.
The Bank’s Gross Non-Performing Loans(NPLs) edged up from KSh 8.3 Billion to KSh 9.2 Billion during the period under review. However, the lender’s NPL exposure was down from KSh 318.1 Million to KSh 210.9 Million.
Family Bank has been on an aggressive transformation program, and an increased focus on digital banking services-which begun before the COVID-19 pandemic hit the shores.
The tier II lender has invested heavily in revamping its PesaPap mobile application with added features that appeal to the customer.
Family Bank is credited with being the first to offer instant cash transfer services between Kenya and China and India, in partnership with SimbaPay, a UK-based Fintech.
Dubbed Family Bank Remit, this platform enables users to send and receive cash from 15 destinations in Africa and beyond.
Kenya’s banking industry has been grappling with the adverse effects of COVID-19 pandemic that has hit its borrowers.
Firms are shutting down or laying off staff, businesses have been disrupted, and incomes lost, all affecting ability of customers to borrow or repay their loans.
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