NBK emerges from loss streak to book Sh150m 6-month profit

NBK Chief Executive Officer Wilfred Musau.
National Bank of Kenya (NBK) has returned to profitability, reporting a Sh150 million half-year net profit yesterday, on a day different firms posted mixed results for the period.

The lender, which is a target of acquisition by KCB Group, made most of its money from savings on interest expenses, with key revenue streams remaining flat.

Savings from interest expenses were about Sh300 million, attributable to a reduction of nearly Sh5 billion in customer deposits.

NBK had reported Sh282 million in losses in a comparable period last year. "The bank achieved this lever of growth against the backdrop of a challenging environment, both externally and internally," said Chief Executive Wilfred Musau in a statement. NBK’s loan book also took a hit of Sh480 million, confirming its precarious financial condition as it continues to violate capitalisation requirements as set by the CBK.

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I&M Holdings for its part announced a 17 per cent rise in net profit growth for the same period to Sh4.5 billion helped by an increase in non-funded income, including fees and commissions.

Customer deposits, on the other hand, grew by over a tenth to Sh237.2 billion as of June 2019.

Daniel Ndonye, I&M Holdings chairman projects that the second half of the year would be better supported by increased digitisation of services. Its new core banking system, according to the chairman, is a major step in increasing operational efficiencies and enhancing delivery standards, while providing a platform to develop more technology-driven financial solutions.

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Meanwhile, regional insurer Jubilee Holdings announced an 11 per cent increase in gross written premiums to Sh20.7 billion from Sh18.7 billion for the half-year to June 30, 2019.

Group Chairman Nizar Juma said the firm recorded a profit after tax of Sh1.8 billion while total assets increased by nine per cent from Sh114.2 billion to Sh124.3 billion.

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DIB Bank Kenya, a subsidiary of Dubai Islamic Bank PJSC, said it reduced its losses marginally to Sh403 million over the six months.

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