KCB Group has posted a strong performance in the first half of the year, to record double net profit of Ksh.15.3 billion compared to Ksh.7.6 billion recorded same period last year.
Profit after tax doubled to Revenues increased by 14 percent on account of higher interest income driven by an increase in earning assets and a lower cost of funding.
According to KCB, the performance was driven by improved economic activity, robust revenues, and lower provisions charge.
Total income increased 13.7 percent to Ksh.51.2 billion during the period, with net interest income up by 17.7 percent to Ksh.36.6 billion from Ksh.31.1 billion last year.
This was on the back of higher interest-earning assets and effective management of the cost of funding during the period.
Operating costs were up by 7 percent on account of an increase in staff costs as the Group enforced cost management initiatives to ring-fence the business from the impact of the ongoing healthcare crisis.
The cost of risk fell to 2.2 percent from 4.0 percent, with the ratio of Non-Performing Loans (NPLs) at 14.3 percent from 13.7 percent in 2020. The stock of NPL closed the half at Ksh.95.7 billion, from Ksh.83.9 billion same period last year.
Most of this increase occurred during the second half of last year, highlighting the strain on customers and their business because of the healthcare crisis.
The lender’s balance sheet stood at Ksh.1.02 trillion, up from Kes.953 billion last year reflecting a 7 percent jump.
Customer deposits were up by 4 percent to Ksh.786.03 billion mainly due to current and savings accounts, while loans grew 9 percent on account of corporate term loans and retail check-offs during the period to close at Ksh.606.9 billion.
The Group maintained a solid capital position at Ksh.172.6 billion, with all key ratios well above the minimum regulatory requirement.
KCB core capital as a proportion of total risk-weighted assets closed the period at 18.2 percent against the Central Bank of Kenya statutory minimum of 10.5 percent.
