IM ups dividend after posting a net profit of Sh12.6b

I&M Group Regional CEO Kihara Maina gives an address during the release of the group’s 2023 results. [Wilberforce Okwiri, Standard]

I&M Group has raised its dividend payout by double-digits after booking a 12.70 per cent growth in net profit to Sh12.6 billion for the year ended December 2023, the lender announced yesterday.

The top-tier lender’s board has recommended a dividend payout of nearly Sh4.22 billion, a 13.33 per cent rise over Sh3.72 billion a year earlier.

The company’s directors said shareholders on record by April 18 will be paid Sh2.55 per share on or around May 24 compared with Sh2.25 per unit the year before. The growth in the banking group’s post-tax profit was largely supported by increased earnings from lending activities.

The lender’s net interest earnings jumped by nearly a quarter year-on-year, climbing 24.78 per cent to Sh28.63 billion.

This came after the bank’s loan book expanded 30.46 per cent to Sh311.33 billion, the company’s unaudited financial performance statement showed.

“We saw significant growth driven by innovative solutions such as the ongoing Ni Sare Kabisa free transfers to M-Pesa and Airtel Money and the largest unsecured personal loan of up to Sh10 million,” said I&M Group Regional CEO Kihara Maina.

I&M joins a host of tier-one peers who have raised dividend distributions to shareholders on the back of increased profit last year.

StanChart has raised dividend pay by 32 per cent to Sh10.96 billion, Stanbic Bank by 21.8 per cent to Sh6.07 billion, while  Absa Bank plans to pay 14.8 per cent more to Sh8.4 billion. Co-operative Bank has, on the other hand, retained a cash distribution of Sh8.8 billion to shareholders after profit increased 5.2 per cent to Sh23.2 billion.

In a year of rising cost of borrowing and elevated cost of living, I&M Group, just like its peers, raised provisions against bad debts in line with the industry’s prudential guidelines.

Loan loss provisions increased 30.97 per cent to Sh6.87 billion.

The bank was enrolled into tier-one status in 2018 after it acquired Giro Bank a year earlier, pushing its market share past the five per cent mark.

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