KCB's profit after tax jumps by 17.5% - CNBC Africa

KCB's profit after tax jumps by 17.5%

Earnings

by Elayne Wangalwa 0

Kenya Commercial Bank (KCB) has posted a 17.5 per cent rise in its profit after tax for its full year results. PHOTO: Getty Images

Buoyed by growth in the group’s balance sheet and non-funded income, the lender’s profit after tax stood at 16.8 billion Kenyan shillings for the year ended 2014 compared to 14.3 billion Kenyan shillings during the same period in 2013.

The group’s net interest income rose by 9.0 per cent to 35.9 billion Kenyan shillings from 33.0 billion Kenyan shillings while the total operating income also increased by 15.6 per cent to 57.9 billion Kenyan shillings. The lender’s fees and commissions were up 21.3 per cent to 12.7 billion Kenyan shillings from 10.5 billion Kenyan shillings.

“During the period, the region benefited from improved macro-economic indicators with most economies posting better growth figures, reduced inflation, lower lending rates and higher remittances” KCB Group chairman, Ngeny Biwott said.

This positive performance from the group - which operates in Kenya, Burundi, Rwanda, South Sudan, Tanzania and Uganda - has also been greatly attributed to positive returns in all subsidiaries. This is amid a tough operating environment in its South Sudan subsidiary.

“We faced unique challenges of doing business in a limiting environment and it has yielded positive results for us in the year 2014. It was in this environment that the board and management put to use all techniques in the application of risk management in a sustainable manner,” Biwott said.

Foreign exchange income rose by 11.9 per cent to 4.2 billion Kenyan shillings while customer deposits was up 23.4 per cent to 377.3 billion Kenyan shillings.

“These impressive results are attributed to a double digit growth in our balance sheet as a result of growth in loans and advances,” said KCB Group Chief Executive Officer, Joshua Oigara.

 “We have continually focused on investment in innovation and technology, tapping alternative channels (KCB Mtaani agents, merchants, M-Benki, pepea transit card) and improving operational efficiency to boost growth. Going forward, these will remain on our radar screen.”

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The lender’s performance highlights the momentum of KCB’s strategy. The group has been building partnerships in the telecommunications, transport and energy sectors and with governments across the region. Furthermore, the bank is looking into entering Ethiopia, Somalia and the eastern part of the Democratic Republic of the Congo.

Meanwhile, the KCB is undertaking a restructuring for the establishment of a non-operating holding company. According to the bank, the restructuring ‘will not affect the current shareholding structure, customers and employees of the company’.

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