Family Bank profit hits Sh638 million

Family Bank has posted a net profit of Sh638.5 million in the first six months of 2020.

This is a 75.2 per cent increase from the Sh364.4 million recorded in the same period last year. 

The lender attributed the growth in earnings to higher net interest income, hugely from loans, advances and income from government securities.

Loans and advances boosted total interest income from Sh3.3 billion to Sh4.1 billion. Net interest income in the period rose by 28.5 per cent to Sh2.9 billion from Sh2.3 billion last year backed by lending and additional investments in government securities.

The total operating income grew by 17.6 per cent to Sh4.2 billion during this period compared to Sh3.6 billion last year. Non-funded income slightly decreased by 1.4 per cent to Sh1.3 billion.

The lender’s balance sheet expanded in the period as its loan book grew by 17.5 per cent to Sh54.9 billion while customer deposits increased by 23.5 per cent to Sh66.7 billion.

Total assets grew by 19.7 per cent to Sh86.9 billion, from Sh72.7 billion during the same period last year while total operating expenses marginally rose by 9.8 per cent to Sh3.4 billion, which the bank attributed to the cost containment measures being implemented internally.

“The bank’s impressive performance is a testament of the resilience of our business in light of our current tough operating environment amidst the Covid-19 pandemic,” said Family Bank Chief Executive Rebecca Mbithi.

"We remain focused on driving a differentiated customer experience driven by a deeper understanding of our customers, automation and digitisation of our processes, of which 80 per cent of our transactions are on the digital platform anchored on simplicity and personalised service as we continue to cushion businesses, especially the micro, small and medium enterprises through the emerging pressures."

The lender has restructured loans worth Sh15 billion and provisioned Sh464 million for bad debt due to Covid-19 during the first half of the year. It has also waived all charges for balance inquiries and money transfers between account and mobile money wallets.

“We recognise that Covid-19 pandemic has resulted in difficult operating environments. As part of our strategy to build a sustainable business, the bank continues to work with the county governments to assist vulnerable groups affected by the pandemic,” said Mbithi.