Equity Bank Kenya, a subsidiary of the Equity Bank Group, has reported a 20% decline in profit after tax, amounting to Ksh.19.3 billion.
This marks the first time in seven years that the subsidiary has recorded a drop in profits. The decrease is largely attributable to high Non-Performing Loans (NPLs) that have hit an industry average of 15%.
Despite this setback, the Equity Bank Group has shown resilience, recording a 5% growth in net earnings for the first nine months of the year, amounting to Ksh.36.2 billion.
This growth is largely due to stable earnings from subsidiaries outside Kenya.
When comparing Equity Bank Kenya to other subsidiaries, there is now a 50:50 split on Profit After Tax.
At the Profit Before Tax level, it’s a 46:54 split. Notably, Equity BCDC, the DRC subsidiary, posted a 142% net profit growth to Ksh.11.4 billion, while the Tanzania subsidiary reported a 136% growth in net earnings.
A Champion for Business Recovery
In the wake of the coronavirus pandemic, Equity Bank Group has positioned itself as a champion for uplifting struggling businesses in the African region.
The group is developing the African recovery and resiliency plan, which includes launching a stimulus package for the continent’s development and transformation.
The initiative, which will cost Ksh.700 billion, is spearheaded by Equity Group Managing Director and Chief Executive Officer, Dr. James Mwangi.
In a recent interview on Citizen TV, Dr. Mwangi outlined the group’s commitment to supporting the recovery of businesses affected by the pandemic.
“Africa must recuperate from the conflict between Russia and Ukraine as well as the present economic challenges,” said Dr. Mwangi.
Despite the challenges faced by Equity Bank Kenya, the Group’s overall performance and commitment to supporting business recovery in Africa demonstrate its resilience and strategic approach to navigating the impacts of the pandemic.
As the Group continues to implement its recovery and resiliency plan, it will be interesting to observe the impacts on its performance and contribution to economic recovery in the region.