KCB Group PLC has recorded KES 40.8 billion in net profit for the full year ending December 2022, a 19.5% increase from KES 34.2 recorded last year due to higher funded and non-funded income streams.
Other subsidiaries, excluding KCB Bank Kenya, contributed 17.0% to the profit before tax, indicating an increase from 13.9% in 2021. This growth was attributed to organic growth and increased scale in the businesses.
The strong performance for the year was a result of our business strategy, which is anchored on customer obsession, sharper execution, and productive organisation culture. The business benefited from a vibrant core banking business, growth of new business lines and accelerated digital transformation to post this record performance.
KCB Group CEO – Paul Russo
In spite of a challenging operating environment, the company has positive momentum and intends to leverage this to drive a significant step change in culture and performance across all business units. The enhanced digital capabilities, impetus in regional businesses, and successful integration of Trust Merchant Bank (TMB) support this outlook for better performance.
Furthermore, the company reported a 19.6% increase in revenues, largely driven by net interest income, which grew by 11.5%.
Non-funded income also experienced substantial growth at 39.8%, largely from trade finance income, lending fees, and commissions.
However, costs increased by 24.1% due to increased business activities and the impact of BPR and TMB acquisitions.
Regarding asset quality, the non-performing loan (NPL) ratio stood at 17.3%, mainly driven by downgrades from the KCB Kenya business.
Gross NPLs were at KES 161.2 billion. Nevertheless, there was a remarkable reduction from the peak numbers in June 2022.
On the balance sheet side, total assets grew by 36.4% to KES 1.55 trillion, supported by growth in loans and investment in government securities.
Customer loans also increased by 27.8% to KES 863 billion, and customer deposits hit the trillion shillings mark, increasing by 35.6% to KES 1.135 trillion, mainly from TMB and organic growth in the existing businesses.
The company’s shareholders’ funds grew by 18.9% to KES 206.3 billion, and the capital base remained well within both internal and regulatory limits.
The board has proposed a final dividend payout of KES 1.00 per share, subject to shareholder approval, in addition to an interim payout of KES 1.00 per share paid out in January 2023, bringing the total dividend payout for the year to KES 6.4 billion.
We have made significant investments in our regional expansion strategy, among them, our latest entry into DRC through the acquisition of 85% of TMB. The investments made are key to accelerating our future growth and commitment to delivering sustainable shareholder value.
KCB Group CEO – Paul Russo
KCB Group Key Corporate Developments
In December, KCB announced the completion of the acquisition of TMB after receiving all the regulatory approvals. Subsequently, the bank kicked off the integration of the business into the Group.
Furthermore, in deepening its citizenship and social impact agenda, the KCB Foundation gave scholarships to over 1,300 needy students who sat for the 2022 Kenya Certificate of Primary Education (KCPE) examinations and joined various secondary schools countrywide last month.
Additionally, the Foundation has set aside KES 700 million to support the 2023 scholarship cohort through secondary and tertiary education.
Moreover, on the sustainability front, KCB Bank screened loans worth over KES 336 billion for social and environmental risks while increasing its green portfolio in the past two years, bolstering its push for sustainable finance.
The Bank also significantly cut its carbon footprint by 11.25% in its premises across the seven countries it operates in, on a deliberate push to reduce carbon emissions from its operations.
Additionally, KCB resource consumption was down by 17% on the back of a systematic and deliberate push to reduce the use of fuel, water, electricity, and paper.
Finally, late last year, KCB unveiled a new brand purpose: For People. For Better. Through this purpose, KCB seeks to be the region’s undisputed financial services leader, which puts people and their diverse needs first, to make life better for millions of the customers they serve. To achieve this, KCB Group is now guided by the brand values of being closer, connected, and courageous.
KCB Group 2023 Outlook
We are bullish about 2023 and are gearing up to maximize all the investments made and opportunities available in our various markets. We have in place a robust strategy that enables us to prudently deploy our capital and resources across the region to ensure superior returns from our investments.
KCB Group CEO – Paul Russo
Read Also: KCB Group Records a 27% Rise in half-year profits to KES 19.6 Billion
