Kenya’s Barclays reports 11.7% pretax growth in H1 - CNBC Africa

Kenya’s Barclays reports 11.7% pretax growth in H1


by Elayne Wangalwa 0

Barclays Bank of Kenya has announced an 11.7 per cent jump in its pretax profit for the first half of 2014. PHOTO: Barclays Bank of Kenya

The lender recorded a 6.1 billion Kenyan shillings profit, an increase of 637 million Kenyan shillings in comparison to the previous period in June 2013.

The positive performance has been attributed to customer loans and advances which grew 20 per cent to 128.4 billion Kenyan shillings by 30 June 2014 from 107.1 billion Kenyan shillings the same period the previous year.

The bank which has a heavy presence in corporate and retail lending total assets grew by 14.9 per cent to 213.2 billion Kenyan shillings.

(READ MORE: Barclays Africa commits $500 mln to power Africa initiative)

“We [Barclays] saw a strong growth in our assets, so we are now growing faster than we have grown in the last seven to eight years. We have grown our total asset book by over 20 per cent which we are very excited about because it means we are on strategy. Customers are finding us relevant and borrowing money from us,” Jeremy Awori, managing director at Barclays Kenya told CNBC Africa.

The financial provider’s customer deposits were up by 6.85 per cent to 148.2 billion Kenyan shillings in June 2014 from 138.7 billion Kenyan shillings the previous period in 2013.

Net interest income grew by 5 per cent to 9.7 billion Kenyan shillings on the strength of growth in interest earning assets. However, the lender’s non-interest income plummeted to 4.2 billion Kenyan shillings, a 5 per cent decrease in comparison to the same period in 2013.

“We experienced a slight decline. Our FX [Forex Exchange] income did not go as much just because we had relatively stable exchange rates during the course of this particular period but we also had a mark to market losses on our visa share holdings,” Awori said.

To meet growing demands in the banking sector so as to enable the bank to work efficiently and grow its market share, Barclay’s is planning to set up a mortgage centre as well as an asset finance centre of excellence.

“We have amplified our innovations agenda and augmented it with game changing products and services as the salary retrenchment cover and the Zidisha Bonus Savings account in order to maintain our competitive edge,” Awori said.

As part of a three-year strategy focusing on enhancing service delivery to clients through multi-channelled solutions, the financial provider opened the first ever 24-hour branch at the port of Mombasa to serve the entire business community early in the year. The bank has also enhanced its mobile banking experience through a mobile app.

Despite the positive performance, the bank’s board of directors did not recommend the payment of an interim dividend in view of Kenya’s central bank requirements.

Yesterday, the board of Barclays Bank of Kenya appointed three new Non-Executive Directors.