Kenya’s most profitable lender and one with the largest balance sheet, KCB Group’s net earnings rose 8% to KSh 6.3 Billion at the end of Q1, 2020. This is compared to KSh 5.8 Billion posted at the end of 31st March 2019.
The bank increased its assets after it acquired National Bank of Kenya in October 2019.
According to its unaudited financial statements for the period ended 31st March, 2020, KCB loans to customers increased from KSh 464.3 Billion in March 2019 to KSh 553.9 Billion in March 2020.
The Group’s balance sheet grew from KSh 725.7 Billion to KSh 947.1 Billion during the period under review. Customer deposits increased significantly from KSh 552 Billion to KSh 740 Billion, a huge cache of funds that the Group has used to drive its lending business.
The value of shareholders’ funds grew from KSh 119.5 Billion to KSh 135.5 Billion.
Interest income on loans advanced to customers increased from KSh 13.4 Billion to KSh 14.7 Billion, pushing up total interest income to KSh 20.2 Billion from KSh 16.8 Billion.
Earnings from Fees and Commissions increased from KSh 2.2 Billion in March 2019 to KSh 2.7 Billion in March 2020.
With COVID-19 pandemic affecting incomes of households and corpporates hence ability to repay loans, KCB Group increased its loan loss provisions from KSh 1.2 Billion to KSh 2.9 Billion.
The portfolio of non-performing loans rose significantly from KSh 38.8 Billion to KSh 66.2 Billion.
KCB Group pre-tax profit increased marginally from KSh 8.5 Billion to KSh 8.9 Billion as the lender moved to restructure loans to customers and firms.
Following the acquisition of NBK, staff costs increase to KSh 5.8 Billion from KSh 4.6 Billion during the period under consideration.
Net earnings of the NBK subsidiary improved from KSh 66.3 Million in March last year to KSh 154.9 Million in Q1, 2020.