Family Bank’s earnings hit Sh2bn on increased lending and expansion

Family Bank’s net profit for the full year to December has improved by a tenth to Sh1.98 billion on the back of increased lending to customers following an aggressive expansion campaign.

The lender Tuesday announced that its net earnings last year grew from the previous year’s Sh1.8 billion as its net loans to customers increased 47.3 per cent to Sh55.9 billion.

This increased lending saw the bank’s total interest income grow 40.8 per cent to Sh10 billion, a majority of which came from loans and advances to its more than 1.7 million customers.

“The great performance by the bank, though in a very challenging macro-economic environment, vindicates not only our growth strategy but the robust performance culture embraced by staff,” Wilfred Kiboro, bank’s chairman, said in a statement.

“We are on course to achieve even greater results as we consolidate our alternative business channels including mobile banking and agency banking.”

The lender’s customer deposits grew by Sh15.6 billion to hit Sh62.7 billion.

Family Bank’s total assets as at the end of last year stood at Sh81.3 billion, having grown by 31.5 per cent, while its total liabilities went up by Sh18.1 billion to Sh69.2 billion.

The bank’s total shareholders’ funds grew by 12 per cent from Sh10.6 billion in 2014 to close last year at Sh11.9 billion.

Family Bank, which has set a target of attaining tier one status in the short term, says the growth in earnings is as a result of its continued focus on small and medium enterprise lending and personal loans.

READ: Family Bank to open 10 new branches before end of year

To enhance its performance, the bank is in the process of expanding its branch network with plans to opening 10 new outlets this year in order to hit a target of 100 by end of December.

The tier-two lender last month launched its 91st branch in Wote Town, Makueni, barely three months after opening three other outlets in Mlolongo, Maua and Kahawa West.

“Our growth momentum demonstrates our strategy is working great as we expand our footprint to every corner of this country,” said Family Bank chief executive Peter Munyiri.

“We are well on course to achieve our target of 100 branches by year end.

“Directors have recommended a dividend payment of Sh0.50 per share, same as last year.”

The lender has also already signed 5,000 agents across the country and is recruiting more merchants as it looks to close the year with double this number.

The bank recently received a Sh1 billion loan from Netherlands-based Oikocredit for on-lending to small and medium-sized businesses, a pointer that its loan book is set to grow further this year.