KCB Group profit for first quarter surges to Sh9.9b

KCB Group has reported a 54.6 per cent rise in profit after tax to Sh9.9 billion in the three months ending March 2022.

The increase from Sh6.4 billion in a similar period last year was boosted by growth in total income and a reduction in loan loss provision.

Kenya's second-largest bank by assets saw its revenues rise by 26 per cent to Sh29 billion on account of an increase in interest income, a jump in non-funded income from lending activities and service fees and a 21.1 per cent rise in earning assets.

"The business showed sustained resilience backed by our proactive approach towards driving income growth, managing liquidity, conservation of capital and cost containment,” said outgoing KCB Group Chief Executive Joshua Oigara.

“A relentless focus on our strategy has enabled us to maintain robust asset growth and deliver a healthy return on our investments.

"We have effectively demonstrated our combined abilities and competencies in managing and responding to the impact of the healthcare crisis across all our markets."

Net interest income grew by 18 per cent to Sh19.7 billion, driven by an increase in net loans and advances coupled with growth in investments in government securities.

This was partially offset by an increase in interest expenses occasioned by tight market liquidity, said the lender. 

Loan loss provisions decreased by 27.5 per cent from a similar period last year largely due to a drop in corporate and digital lending impairment charge after Covid-19 related provisions recognised in the 2021 full year.

The non-performing loan book continued to come under pressure due to slow recovery in the construction, hospitality and part of the manufacturing sectors, causing a deterioration from 14.8 per cent to 17 per cent.