KCB Group Profits For Q1 Marginally Up By 1.8 Percent

Kenya Commercial Bank’s net profits for the first 3 three months of 2021 rose marginally by 1.8 percent to 5.37 billion shillings from 6.26 billion shillings.

The lender has attributed the near-stagnation of the profits was as a result of lower fees and commissions on short-term mobile loans.

Non-interest income consequently fell 20 percent to Sh6.3 billion from Sh7.8 billion. “Overall performance was largely impacted by lower non-interest income due to subdued digital lending on reduced disbursements and lower customer transactions,” chief executive Joshua Oigara said.

The bank started reducing mobile lending in the year ended December when customers took out 154 billion shillings, down 27.3 percent from 212.1 billion shillings in 2019.

The lender’s total interest income from loans and government debt securities rose 8.7 percent to 21.9 percent. Its loan book expanded 7.8 percent to 597.1 billion shillings while investment in bonds and T-bills rose by a marginal 1.4 percent to 190.5 billion shillings.

Loan loss provision was flat at 2.8 billion shillings despite gross non-performing loans jumping 48 percent to 98 billion shillings, indicating increased confidence about the economic outlook.

“Quarter two of the year started with a month-long lockdown in Kenya, a reminder that the pandemic is not over yet,” Mr. Oigara said. “We however expect to see a recovery in the last two months of the quarter with an increase in uptake on our mobile platform –VOOMA and a strong balance sheet growth.”

At the same time, NCBA Group PLC has recorded an after-tax profit of KES 2.84 billion for the quarter ending March 31, 2021. This was an increase of 74% compared to KES 1.6 billion that NCBA Group posted during a similar period in 2020.

“We are immensely proud of our strong financial results during the first quarter, NCBA Group has demonstrated the ability to tightly balance strong credit discipline with its commitment to support its customers during this period,” said Mr. NCBA Group Managing Director, John Gachora.