Family Bank posted a net loss of Sh492.4 million in the review period compared to a net profit of Sh711.5 million the year before.
The bank's performance was weighed down by reduced lending and lower interest income in the wake of the rate caps regime.
Family Bank slipped into the red in the six months to June, weighed down by reduced lending and lower interest income in the wake of the rate caps regime.
The mid-sized bank posted a net loss of Sh492.4 million in the review period compared to a net profit of Sh711.5 million the year before.
Net interest earnings tanked by Sh1.6 billion to Sh1.9 billion from Sh3.5 billion in June 2016 — highlighting the impact of a smaller loan book and the rate caps which were not in place in the first half of last year.
Family Bank’s lending contracted to Sh43.8 billion from Sh57.7 billion.
Non-interest income from fees and commissions dropped 14.6 per cent to Sh1.12 billion.
The bank’s investment in government securities rose to Sh9.2 billion from Sh6.1 billion. Customer deposits stood at Sh47.5 billion, having dropped from Sh54.7 billion.
Provision for bad loans increased by nearly a third to Sh391 million from Sh299 million as the stock of gross bad debt increased to Sh7.7 billion from Sh5.1 billion.
The bank’s liquidity ratio stood at 36.8 per cent at the end of the six-month period — the highest ever recorded position in the past one year –and above the statutory 20 per cent mark.
The ratio had stood at 14.4 per cent in December 2016, dropping below the minimum regulatory threshold of 20 per cent.
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