|KCB’s Chief Executive Officer Joshua Oigara|
By NICHOLAS WAITATHU
NAIROBI: Kenya Commercial Bank (KCB) has reported a 31 per cent jump in its first-quarter pretax profit.
The earnings increased to Sh5.6 billion up from Sh4.3 billion recorded during the same period in 2013. The bank’s balance sheet grew by 11 per cent from Sh369.5 billion during the first quarter of 2013 to Sh411.4 billion this year.
“Our main driver of growth across all our business segments was loans across major sectors in the economy, greater collaborations with county governments, launch of mobile loan product and solid performance of our cost management agenda,” said bank’s Chief Executive Officer Joshua Oigara. He said the growth in balance sheet was largely the result of steady increase in liabilities with customer deposits growing by 9 per cent from Sh287.3 billion during the first quarter of 2013 to Sh313.5 billion in the same period in 2014.
“We expect it to grow further as we continue to support lending in the different sectors of our economy,” he said in a statement.
The performance, Oigara stated, reflects a strong growth of total operating which went up from Sh11.2 billion during the first quarter of 2013 to Sh12.8 billion this quarter.
The total operating expenses declined from Sh6.6 billion in 2013 to Sh6.4 billion in the same period in 2014. The bank cost to income ratio reduced from 57.6 per cent during the first quarter in 2013 to 49.1 per cent in the same period in 2014.
He described this as good news for the business as the bank continues to aggressively implement cost management initiatives in its operations. International businesses continued to progress moving up from Sh0.6 billion in the first quarter of 2013 to Sh0.7 billion during the same period in 2014, contributing 12.3 per cent to the Group’s overall profit.
“Our business efficiency and growth initiatives are being implemented through our Bancassurance services and investment banking products that will see the bank replicating this into international businesses to drive improved performance in all the business segments,” Oigara added.
The bank, which also operates in Rwanda, Burundi, Tanzania, Uganda and South Sudan, said its cost-to-income ratio fell to 49.1 per cent from 57.6 per cent in the first quarter of 2013. It said that net provisions for bad debt rose to Sh775 million from Sh375 million previously.