Financial service provider Kenya Commercial Bank (KCB) has reported a growth of 13 per cent in its pretax profit.
Buoyed by growth in net interest income and new business lines in fees and commissions, the group’s profit before tax rose to 13.2 billion Kenya shillings ($129 million) for the six months of the year from 11.7 billion Kenya shillings over the comparable period last year.
“We have consistently focused on growing new business lines and strengthening the subsidiaries to drive the business to higher profitability and guarantee its sustainability. This is bearing fruit as seen in the increased earnings,” KCB Group CEO Joshua Oigara said during an investor briefing in Nairobi.
With six subsidiaries across the East African region, the group’s net interest income was up 13.5 per cent to 19.4 billion Kenya shillings while fees and commissions rose by 21 per cent to 6.8 billion Kenya shillings.
Kenya contributed the highest growth in the profit before tax margin. The East African nation contributed 90 per cent, followed by South Sudan’s 6.9 per cent, Tanzania’s 1.4 per cent, Rwanda’s 1.3 per cent and Uganda’s 0.4 per cent.
Amid a tough operating environment in its South Sudan, Burundi and Ugandan subsidiaries, East Africa’s largest commercial bank in terms of assets saw the group’s total assets grow by 29 per cent to 567 billion Kenya shillings.
Speaking in regards to its South Sudan and Burundi subsidiary that are currently facing political skirmishes KCB Group Chairman, Ngeny Biwott said, “We had a relatively tough macro-economic and political environment in most of the markets the bank operates. In South Sudan and Burundi, we had economic shocks due to political tensions.”
Despite the situation in these countries as well as currency depreciation in Kenya, Uganda and Tanzania, the lender anticipates having a ‘brighter outlook’ in its growth trajectory going forward.
Meanwhile, the bank is seeking to leverage on developments in technology to further deepen financial inclusion in the East African region.
“We have in place a model to enhance operational competencies, revenue generation and drive greater efficiencies across the markets,” Oigara said.