Equity Bank registers positive returns in Q1

by Elayne Wangalwa 0

Financial services firm, Equity Group Holdings has registered a 13 per cent increase in its pretax profit for the first quarter of 2015.

The lender’s pretax profit climbed to 6.1 billion Kenyan shillings up from 5.4 billion Kenyan shillings recorded over a similar period the previous year. The group has attributed the positive performance to its revenue diversification strategy which is currently under implementation.

“The group’s sustained investments in mobile and agency banking, payment systems and money transfer as well as diaspora remittances and operating expenses optimisation initiatives will continue to contribute to the positive growth trajectory,” Equity Group Holdings CEO & managing director James Mwangi explained during an investors’ briefing in Nairobi.

Investments in growing its agency banking resulted in a solid transactions growth at its over 19,000 agents.

“We have a 60 per cent growth year on year and our model has accelerated financial inclusion and access to banking services,” Mwangi said.

Present in five countries within the East African region, the subsidiaries registered a total of 373 billion Kenyan shillings in its total assets, representing a growth of 26 per cent.

Loans and advances to customers grew to 225 billion Kenyan shillings up from 214 billion Kenyan shillings in 2013, while customer deposits increased by 35 per cent to 278 billion Kenyan shillings.

“We are highly optimistic that the growth momentum will be maintained throughout the year with a number of new products and services set to be launched in the coming months,” Mwangi said.

The Nairobi Securities Exchange, Uganda Securities Exchange and recently Rwanda Stock Exchange listed financial provider reported that its total operating income grew by 19 per cent to 13.2 billion Kenyan shillings. The lender noted that its incomes were lifted by momentous successes in driving non- funded revenues.

Meanwhile, the lender’s mobile virtual network operator (MVNO) service is growing. Its MVNO service dubbed, Equitel has led to an 81 per cent growth with over 650,000 subscribers.

During the investor briefing it was announced that the purchase of 12.2 per cent interest in the group was completed between Norfund and Norwegian private investors.

“Equity is delighted to welcome Norfund and Norfinance into the anchor shareholding of the Group. The investment further strengthens and diversifies Equity Group’s capital base and the Bank is confident that the combination of Norfund’s depth of expertise and experience in the financial services sector.”