NCBA Reports A Pre-Tax Profit Of Ksh 7.4 Billion In 6 Months

The NCBA Group PLC has posted a profit before tax of 7.4 billion shillings in its half-year results ending June which is a 90 percent increase compared to 3.9 billion shillings reported during a similar period last year.

The Group registered a profit after tax of 4.7 billion shillings representing 77 percent growth up from 2.6 billion shillings in half-year 2020.

Growth in profitability was attributed to the increase in operating income by 2.8 billion shillings driven by higher customer activity and a decline in loan impairment charges by 1.7 billion shillings.

Putting NCBA’s numbers into perspective, the asset base rose to 542 billion shillings, 6 percent up year on year. Customer deposits closed at 437 billion shillings, 12 percent up year on year.

At the same time, the Group disbursed 272 billion shillings in digital loans, a 16 percent increase year on year in line with its digitization agenda and its commitment to supporting small businesses and individual customers during this period.

The operating income for the lender was at 24.1 billion shillings, up 13 percent up on a year on year. The operating profit before loan loss provisions 13.3 billion shillings, 16 percent up on a year on year.

The loan impairments charges for the period stood at 5.9 billion shillings, 22% down year on year. The Non-Performing Loans coverage ratio increased to 68%, from 55% in the same period last year. Profit after tax stood at 4.7 billion shillings, up 77% year on year.

“Looking at our results, you will note that our loan impairment charges, which were a lag on performance last year, have greatly reduced. Over the last year, we have taken the bold step to restructure 35% of our credit portfolio and we have seen a positive outcome of those actions as 82% of that restructured portfolio is now performing,” said Mr. John Gachora, NCBA Group Managing Director.

During the first half of the year, NCBA signed several partnerships aimed at solidifying its strength in asset finance and growing its property finance business. On the asset finance front, the bank signed partnerships with Simba Corp, DT Dobie, Tata Africa Holdings, Isuzu East Africa to offer asset finance solutions to customers.

Read More: NCBA Reports An After-tax Profit of Ksh 2.84 Billion In Q1