Equity Bank lifts dividend despite flat profit growth

Equity Group’s net profit for the year ended December remained flat at Sh17.3 billion as higher interest and operating expenses pinned down earnings.

The lender declared a dividend of Sh2 per share, raising it from the previous year’s Sh1.8 per share.

While net profits stagnated, the bank’s comprehensive income dropped 41.2 per cent to Sh10.4 billion as a result of Sh5.7 billion forex losses recorded in translating financial statements of its subsidiaries into Kenya shillings.

Most of the forex losses came from South Sudan whose currency has been devalued by more than 100 per cent since December, hitting Kenyan lenders with operations in that market including KCB and CfC Stanbic Bank.

READ: KCB reports Sh19bn profit despite Sh6bn South Sudan hit

ALSO READ: CfC Stanbic profit dips as Juba forex crisis erodes Sh7bn

Equity’s interest income jumped 22.8 per cent to Sh43.4 billion as the loan book expanded 26 per cent to Sh269.8 billion.

Its interest expenses rose 50.6 per cent to Sh9.3 billion on the impact of higher interest rates and customer deposits that increased by Sh56.7 billion to Sh302.1 billion.

Non-interest income, including fees on transactions, rose 18.7 per cent to Sh21.9 billion.

Operating expenses grew 21.8 per cent to Sh32.1 billion.