KCB Group plans to inject up to KSh3 billion fresh capital into the recently acquired National Bank of Kenya(NBK) to assist the subsidiary meet the minimum capital ratios set out by the Central Bank of Kenya(CBK).

While the lender put in KSh 5 billion capital into NBK in December 2019, the new acquisition is yet to meet the capital adequacy requirements.

“When we acquired NBK, we estimated we would provide the subsidiary with KSh7.5 billion to KSh8 billion of capital,” said KCB chief executive Joshua Oigara.

KCB has announced that it will provide the additional capital by June this year.

Before its acquisition, NBK struggled with a huge portfolio of non-performing loans that threatened to sink the bank.

KCB inherited NBK’s share of bad loans after it bought the lender. East Africa’s leading bank by assets plans to reduce NBK’s non-performing loans from 50% of the loan book to 8% in two years.

Financial statements of NBK for the year ended 31st December 2019 indicate that its balance sheet fell slightly to KSh 111.9 Billion from KSh 114.8 Billion the previous year.

Gross Non-performing loans fell from KSh 31.5 Billion to KSh 25.2 Billion at the end of 2019 financial year.

NBK’s net loans and advances to customers declined from KSh 47.8 Billion to KSh 45.9 Billion during the period under consideration.

NBK core capital to total deposit ratio, core capital to total risk-weighted assets and Total capital to total risk-weighted assets, all fell below the minimums set by the CBK in 2019.

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KCB Lists Additional 142.9 Million Shares After Acquisition of NBK

KCB Group plans to inject up to KSh3 billion fresh capital into the recently acquired National Bank of Kenya(NBK) to assist the subsidiary meet the minimum capital ratios set out by the Central Bank of Kenya(CBK).

While the lender put in KSh 5 billion capital into NBK in December 2019, the new acquisition is yet to meet the capital adequacy requirements.

“When we acquired NBK, we estimated we would provide the subsidiary with KSh7.5 billion to KSh8 billion of capital,” said KCB chief executive Joshua Oigara.

KCB has announced that it will provide the additional capital by June this year.

Before its acquisition, NBK struggled with a huge portfolio of non-performing loans that threatened to sink the bank.

KCB inherited NBK’s share of bad loans after it bought the lender. East Africa’s leading bank by assets plans to reduce NBK’s non-performing loans from 50% of the loan book to 8% in two years.

Financial statements of NBK for the year ended 31st December 2019 indicate that its balance sheet fell slightly to KSh 111.9 Billion from KSh 114.8 Billion the previous year.

Gross Non-performing loans fell from KSh 31.5 Billion to KSh 25.2 Billion at the end of 2019 financial year.

NBK’s net loans and advances to customers declined from KSh 47.8 Billion to KSh 45.9 Billion during the period under consideration.

NBK core capital to total deposit ratio, core capital to total risk-weighted assets and Total capital to total risk-weighted assets, all fell below the minimums set by the CBK in 2019.

ALSO READ:

KCB Lists Additional 142.9 Million Shares After Acquisition of NBK