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Corporate

Kenyan NIC's profit up in Jan-Sept, eyes Uganda

NIC banking hall. Kenya's NIC Bank increased its net interest income in the first nine months of the year to boost pre-tax profit but said it was concerned about the impact of high inflation and interest rates on economic growth. File
NIC banking hall. Kenya's NIC Bank increased its net interest income in the first nine months of the year to boost pre-tax profit but said it was concerned about the impact of high inflation and interest rates on economic growth. File 

Kenya's NIC Bank increased its net interest income in the first nine months of the year to boost pre-tax profit but said it was concerned about the impact of high inflation and interest rates on economic growth.

The mid-tier lender, which is known for its strength in asset financing, posted a 29 percent growth in pretax profit to Sh2.6b ($28.8 million) for the period ended September.

NIC warned that high inflation and interest rates in its home market could slow economic growth, adding that it was looking to open a subsidiary in neighbouring Uganda.

"The external and domestic shocks, which have resulted in high inflation and tightening of the monetary policy, are expected to slow down the growth momentum of the Kenyan economy," said James Macharia, NIC's chief executive.

During the period under review, NIC increased its net interest income by a quarter to 3 billion shillings after its loan book grew 42 percent. Fees and commissions rose 15 percent to Sh1.7b.

Macharia said the growth in non-funded income to account for just over a third of the bank's total operating income during the period was in line with the management's long-term vision of diversifying its revenue streams.

In addition to a subsidiary in the second largest economy in east Africa, Tanzania, NIC runs an investment bank, a bancassurance business and a securities brokerage.

"To maintain our regional footprint, plans are at an advanced stage to establish a banking subsidiary in Uganda," NIC said. ($1 = Sh90.3000)

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