M-Shwari fees raise CBA profit 52.7pc to Sh3.9bn

Commercial Bank of Africa Centre in Upper Hill, Nairobi. PHOTO | FILE
Commercial Bank of Africa Centre in Upper Hill, Nairobi. PHOTO | FILE 

Commercial Bank of Africa (CBA) on Thursday announced that net profit for the nine months to September had jumped 52.7 per cent, the fastest growth rate by a tier one lender during this period.

The privately-owned lender said its quarter three after-tax profit stood at Sh3.9 billion compared to the Sh2.56 billion it recorded during a corresponding period last year.

CBA’s earnings were significantly boosted by income from fees charged on its mobile loan offering M-Shwari, interest income from loans, as well as government securities.

“The growth was powered by strategic investments on our IT and a service delivery environment that is beginning to pay off,” said Isaac Awuondo, group managing director.

CBA’s one-off charges on M-Shwari loans helped lift its fees and commissions by Sh1.7 billion to close the period at Sh4.1 billion, highlighting the product’s centrality to its performance.

The bank’s interest income from loans grew 10.8 per cent to Sh10.3 billion while investment in government securities earned the lender Sh5.1 billion, representing a year-on-year increase of 16.7 per cent.

At 52.7 per cent, CBA is Kenya’s fastest growing large bank as at Q3 followed by Co-operative Bank which posted a 22 per cent growth in net earnings to Sh10.5 billion.

Kenya’s largest bank by assets, KCB Group, posted a 16 per cent growth in the third quarter to earn Sh15.9 billion profit.