• Advertise with Us
Monday, December 4, 2023
  • Login
No Result
View All Result
NEWSLETTER
Kenyan Wallstreet
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Banking
    • Aviation
    • Energy
    • Manufacturing
    • Markets
    • Technology
    • Startups
  • Money Matters
  • Podcast
  • Videos
  • Digital Assets
  • Calendar
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Banking
    • Aviation
    • Energy
    • Manufacturing
    • Markets
    • Technology
    • Startups
  • Money Matters
  • Podcast
  • Videos
  • Digital Assets
  • Calendar
No Result
View All Result
Kenyan Wallstreet
No Result
View All Result

Kenya’s Banking Sector Quarterly Profit Before Tax falls to KSh 49.08 Billion

Jackson OkothbyJackson Okoth
November 23, 2021
in Banking, Kenyan News
Reading Time: 4 mins read
Inter-Bank Rate

CBK


Kenya’s Quarterly profit before tax decreased by KSh 1.45 billion from KSh50.53 billion in June 2021 to KSh49.08 billion in September 2021. This was as a result of a higher increase in expenses (4.7 per cent) as compared to an increase in income (2.2 per cent). Return on Assets decreased to 2.65 per cent in September 2021 from 2.71 per cent in June 2021.

This is according to the latest figures from the Central Bank of Kenya (CBK) contained in the third quarter Commercial Bank Credit Officer Survey that covered between June and September 2021 and involved 39 banks.

ADVERTISEMENT

Kenya’s Banking Industry’s aggregate balance sheet increased by 2.5 per cent to KSh5,822.09 billion in September 2021, from Ksh.5,679.99 billion in June 2021.

Gross loans increased by 2.7 per cent from KSh 3,110.07 billion in June 2021, to KSh 3,193.26 billion in September 2021. The growth in gross loans was mainly due to increased advances in the Trade and Real Estate sectors.

Total deposits increased by 2.3 per cent from KSh 4,249.41 billion in June 2021, to KSh4,345.72 billion in September 2021.

The CBK undertakes a quarterly Credit Officer Survey to identify the potential drivers of credit risk. The survey requires senior credit officers of banks to indicate their bank’s perception or actual position in the immediate past quarter and the subsequent quarter in terms of demand for credit, credit standards, asset quality, credit recovery efforts, deployment of liquidity and impact of implementing new standards.

Kenya’s banking sector asset quality, measured by gross nonperforming loans to gross loans ratio improved from 14.0 per cent in June 2021, to 13.6 per cent in September 2021. This was attributed to a 2.7 per cent increase in gross loans which was higher than a 0.09 per cent increase in non-performing loans.

Return on Equity decreased from 22.67 per cent in June 2021, to 21.97 per cent in September This is a result of a decrease in quarterly profits before tax (2.87 per cent) and an increase in total shareholders’ funds (3.80 per cent).

Liquidity in the banking sector decreased slightly from 56.8 per cent in June 2021, to 56.7 per cent in September 2021. This was well above the minimum statutory ratio of 20 per cent

41 per cent of Kenya’s banks indicated that NPLs are likely to fall in the fourth quarter of 2021. This is attributed to enhanced recovery efforts being implemented by most banks. 26 per cent of the respondents expect the level of NPLs to rise in the fourth quarter of 2021 as a result of the continued COVID-19 pandemic. 33 per cent of respondents expect NPLs to remain constant.

Banks indicated that the level of NPLs is expected to remain constant in ten economic sectors and fall or remain unchanged in the Trade Sector.

For the quarter ended December 31, 2021, Kenya’s banks expect to intensify their credit recovery efforts in all economic sectors. The intensified recovery efforts are aimed at improving the overall quality of the asset portfolio.

For the quarter ended December 31, 2021, banks expect to intensify their credit recovery efforts in all economic sectors. The intensified recovery efforts are aimed at improving the overall quality of the asset portfolio.

The main sectors that Kenya’s banks intend to intensify credit recovery efforts, in order to enhance reduction of NPLs, therefore, improving the overall quality of their asset portfolio, are Trade (87 per cent); Personal and Household (86 per cent); Building and Construction (81 per cent); Real Estate (79 per cent) and Manufacturing (78 per cent).

With improved liquidity, it is expected that in the fourth quarter of 2021, credit to the private sector will increase as Kenya’s banks intend to deploy the additional liquidity by investing in Treasury Bonds (23 per cent), lending to the private sector (21 per cent), investing in Treasury Bills (19 per cent), interbank lending (19 per cent), taking advantage of CBK liquidity management through repos (12 per cent), investing in other instruments including offshore (3 per cent) and increasing their cash holding (3 per cent).

ALSO READ: Kenyan Banks have Adequate Buffers Against COVID-19 Shocks, Report


Previous Post

Kenya Targets to Raise KSh 106 Bn in Fifth Eurobond Issue

Next Post

Reprieve as Tea Auction Records an Increase in Prices

Related Posts

Equity Group CEO James Mwangi.

Equity Group Completes Acquisition of Rwandan Bank

December 2, 2023
Bigstore

Bigstore Secures Funding, Expands eCommerce Services

December 2, 2023

Kenya’s Inflation Rate Dropped Marginally in November

December 1, 2023

Bamburi Discontinues Ordinary Portland Cement, Pushes Greener Products

December 1, 2023

African Experts Call for New Paradigm to Unlock Methane Action Financing

November 30, 2023

Kenya Signs Food MoU, Targets to Cut Imports by US$200M Per Year

November 30, 2023

Diaspora Capitalizes on Weak Shilling with Real Estate

December 1, 2023

Sameer Issues Profit Warning, Plans to Retire Foreign-Currency Dominated Liabilities

November 30, 2023
Load More
Next Post
Tea Auction Prices

Reprieve as Tea Auction Records an Increase in Prices

Follow Us

  • 167.4k Followers
  • 4.1k Subscribers
  • 1.2k Followers

WhatsApp

Subscribe

Telegram  

Subscribe

Podcasts

Featured

No Content Available

About Us

We are a leading integrated digital content platform providing in-depth business and financial news across Sub-Saharan Africa & the globe.

Contact Us

Kenyan Wall Street
Email: [email protected]
Website: www.kenyanwallstreet.com

Disclaimer

The information contained in this website is for general information purposes only.
Read more..

  • Advertise with Us

Copyright 2023. The Kenyan Wall Street LTD. All Rights Reserved.

No Result
View All Result
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Aviation
    • Banking
    • Energy
    • Infrastructure
    • Insurance
    • Investment
    • Manufacturing
    • Markets
    • Public Policy
    • Real Estate
    • Startups
    • Technology
  • Podcast
  • Videos
  • Events

Copyright 2023. The Kenyan Wall Street LTD. All Rights Reserved.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In