Here Is a List Of Banks That Have Issued Profit Warnings

2020 was no good year for Kenyan commercial banks. The majority of the banks have now issued profit warnings in the results set to be announced latest March 2021.

During the year, as Covid-19 hit hard, Kenyan banks were forced to restructure loans in what CBK said was aimed at cushioning customers against the effects of Covid-19.

The following banks have projected that their profits will fall:

Co-operative Bank of Kenya

Absa Bank Kenya

Diamond Trust Bank

Standard Chartered Bank

I & M Holdings

NCBA

Kenyan commercial banks have until the end of the month of March to release their full-year financial results on a year that was ruled by a pandemic.

“Covid-19 was an even in history that nobody anticipated. It got most businesses unaware and we actually ended up just reacting towards it,” said Jeremy Awori, CEO of Absa Bank at an early function.

Many top banks have blamed the rise in non-performing loans as the main reason for the drop in profits. The ratio to non-performing loans has risen from 12.5 percent to 13.6 percent in October 2021.

The directive by CBK to have banks drop charges on cash moved between bank wallets or from an account to a mobile wallet has also hurt the banks.

“Loan loss provisions have been much higher than in the previous year in appreciation of the challenges that businesses and households continue to grapple with in meeting their obligations to the bank,” said Co-operative Bank in a statement.

The banks are now saying the fall in profits might continue into the 2021 financial year if the prevailing conditions will persist.

Central Bank of Kenya (CBK) has had to issue a circular asking all banks to revise their capital levels to reflect the prevailing economic hardships before making any dividend payment decision.

This, CBK hope will help cushion banks as they run the business.