Sidian records Sh72 million profit before tax

Sidian bank has recorded Sh72 million profit before tax, a 28 per cent drop from the previous year’s profitability of Sh99 million.

The performance coming in the wake of a challenging year due to the Covid-19 pandemic is attributed to growth in the loan book by 31 per cent while customer deposits grew by 32 per cent. As a result, the Bank’s balance sheet increased by 27 per cent from Sh26.5 billion to Sh33.5 billion.

The increased lending in the period resulted in higher loans interest income which grew by 13 per cent as well as increased lending fees which boosted overall performance. Loan impairment provisions were lower at Sh187 million as of December 31 2020 compared to Sh403 million as of December 31 2019.

This bank’s gross Non-Performing Loans (NPLs) reduced by 28 per cent from Sh3.3 billion in 2019 to Sh 2.3 billion in 2020 as a result of focused credit management and collections.

Commenting on the financial performance, the CEO Mr Chege Thumbi, indicated that the Bank will continue to pursue innovations to deliver to the market, solutions that will allow banks clients to access services more conveniently and efficiently.

The Bank has sustained its profitability despite the pandemic through diversification of the Bank’s revenue streams to support SME's through a variety of solutions that resonate with the target market.

The financial year under focus proved tough for many banks due to the effects of Covid-19 which affected the economies of both the local and international markets.

The lender in 2020 launched a digital solution that allows customers and non-customers to access bid bonds in less than five minutes, cutting off the need for physical bank visits and queues at bank branches.

Elsewhere Diamond Trust Bank (DTB)’s after-tax profits dipped by 51 per cent to Sh3.5billion last year.

The bank attributed the performance to the prudent approach it adopted by making stringent provisions of Sh7.3billion against the loan book in 2020, a reflection of the elevated credit risk environment prevalent since the outbreak of the COVID-19 pandemic in March last year.

The group’s gross non-performing loans rose to Sh22.8 billion during the period, compared to Sh15.9 billion in 2019. The additional provisions for bad loans made during the year increased the group’s specific provision coverage ratio to 43 per cent, compared to 33 per cent a year earlier.

“As East Africa continues on its march to a digital economy, DTB will leverage on its many strengths and strive to be at the forefront of offering appropriately tailored solutions which not only meet changing consumer expectations but also provide enriched customer experiences, truly embedding ourselves in the lifestyles of our customers,” said Nasim Devji, DTB’s Managing Director and Group Chief Executive Officer.

L-R: Lucy Njanja, Branch Manager - Gikomba, Loise Mwangi, Head -Branches and Chege Thumbi, CEO, at the Gikomba Branch opening in January