Equity Group Holding’s net profit grew 79 percent in nine months to September 30, 2021, in what the lender has attributed to resilience, a versatile business model, and diversification strategy.
The lender posted Ksh.26.9 billion net profit for the period under review compared to the Ksh.15 billion made during the same period last year.
Equity Group, that has over 15 million customers across six countries in Africa, the performance witnessed in the third quarter was hugely driven by subsidiaries revenue and deposits.
For the first time deposits in the subsidiaries went above 40% to 42% while Equity bank Kenya only contributed 58 percent.
The lender’s revenue surged 37 percent from 30 percent.
“The bulk of this growth has come from our subsidiaries, we continues with our regional expansion and we felt that that is where the offensive strategy would play best,” said Dr. James Mwangi, Equity Group CEO.
This time last year, the group had its total assets valued at Ksh.933.9 billion, setting its eyes on the trillion mark that has been actualized 12 months later, growing by 8 percent to Ksh.1.18 trillion.
The growth was driven by a 27 percent growth in customer deposits that grew to Ksh.875.7 billion up from Ksh.691 billion while their total income increased 25 percent.
With the resumption of various sectors across the countries that equity operate in, the group’s loan book grew by 23 percent to Ksh.559 billion shillings while non-performing loans went down from 10.4% to 8.9% signaling revival of businesses especially the small businesses.
“On growth the economy last year shrunk by 0.1%, we grew a loanbook by 27%. This year the economy is anticipated to have grown by 4%, we’ve grown our losn book by 23.% so we’re growing five times faster than the economy,” Dr. Mwangi added.
Driven by the pandemic, the group has also seen an increase in cashless transactions with nearly all transactions initiated & completed on the digital platforms.
In the year under review, over three million transactions worth Ksh.3 billion were conducted online.
As a result, ATM transactions reduced by half in the last one year. The bank is now looking to invest more on digital innovation.
“We have an expanded appetite, we have liquidity in our balance sheet and knock our doors. You dont need to knock our doors by walking into our branch. Just click the button and self serve,” said Polycarp Igathe, Chief Commercial Officer, Equity Group.
The Nairobi Securities Exchange (NSE) listed company which has so far set camp in six countries within the continent is now hopeful that non funding income will accelerate faster owing to regional trade.
To cushion its customers during the COVID-19 pandemic, the bank restructured Ksh.171 billion worth of loans with the repayment of Ksh.122 billion resumed in the period under review.
Meanwhile, the repayment of the remaining Ksh.39 billion in loans is set to resume in the next 12 months.
