Barclays profit jumps to Sh4.2 billion, eyes diversification into new revenue streams

Barclays Bank of Kenya (BBK) says its profit after tax grew to Sh4.23 billion from Sh3.73 for the six months period ended June 30, 2014. However, the bank, which posted a 2.4 per cent drop in pre-tax profit during the same period, announced plans to raise Sh4 billion in additional capital by next month.

The bank's profit before tax (PBT) and exceptional items fell to Sh6.11 billion from Sh6.26 billion in a similar period last year. The financial institution which ranks among the oldest banks in the country, however, gained from the isolation of a one-off restructuring cost of Sh788.25 million to record a 13.5 per cent growth in profit after tax.

Managing Director Jeremy Awori said the bank is now diversifying its income streams with hopes of penetrating more territories, which had initially been dominated by its competitors.

Awori said the bank, which has embarked on a three-year transformation journey to reclaim more market share, is now diversifying and making inroads into the investment banking fraternity, insurance business, mortgage business, agribusiness, retail and the Small and Medium-sized Enterprises (SMEs).

"This is a three to five-year strategy to make BBK a "Go-To" bank," Awori told an investor briefing in Nairobi, yesterday, adding that," during the time of the financial crisis we were not aggressive around our balance. We are now growing our balance sheet and diversifying into new revenue streams."

Chief Financial Officer Yusuf Omari said the bank would raise additional capital from the international debt markets to shore up its Tier 2 capital, currently standing at Sh1.6 billion compared to Tier 1 capital of Sh30.4 billion.