Family Bank profit up on reforms

Family Bank CEO Dr David Thuku, Company Secretary & Director Legal Services Ms Rebecca Mbithi and Chairman Dr Wilfred Kiboro.

Family Bank weathered market headwinds to post over 300 per cent growth in profit for the third quarter.

Emerging from significant setbacks, the lender reported Sh704.6 million in profit after tax as at September 30, a huge jump from the Sh187.7 million made in a similar period last year.

The performance was attributed to among other factors, “aggressive” deposit mobilisation and prudent cost management”, which saw its operating expenses drop by Sh23.9 million from Sh4.69 billion to Sh4.66 billion.

Family Bank Chief Executive Rebecca Mbithi said the company saw its operating income grow by 14 per cent from Sh4.9 billion last year to Sh5.6 billion.

“As a changing bank, we have witnessed tremendous growth in all parameters, for instance in our loan book, which grew from Sh44.5 billion in the nine months to September last year to Sh49.3 billion this year,” she said.

Adoption of digital channels saw 70 per cent of transactions conducted online, including loan advances. Overall, the bank’s loans stood at Sh4.4 billion from Sh4.1 billion in September last year.

“During the period, the bank witnessed a 25 per cent deposit growth due to transfer of transactions online,” Ms Mbithi said.

Net interest income grew by 16 per cent from Sh3.1 billion to Sh3.6 billion.

The bank’s chairman, Wilfred Kiboro, said even as the lender set its sights on a full recovery path, it would not do so at the expense of varied stakeholder interests.

“Though we intend to bring on board more institutional clients, individual clients and SMEs will still be our main focus since through them we have come to have a bigger impact than other segments,” he said.

The bank will not make significant changes to its lending practices even after removal of the rate cap.

“Banks thrive when they work with their customers, therefore we are not going to review our lending rates any time soon,” said Mr Kiboro.