The bank’s net profit in the period stood at Sh410.7 million compared to Sh370.7 million a year earlier.
The lender said its non-performing loans rose 60 per cent to Sh5.1 billion, a move that saw the lender raise its loan loss provision to Sh1.8 billion from Sh1.3 billion.
National Bank reported a 10.8 per cent growth in net profit for the first three months helped by higher interest income from lending, even as its bad debt portfolio jumped 60 per cent.
The bank’s net profit in the period stood at Sh410.7 million compared to Sh370.7 million a year earlier.
The performance was driven by a 24.3 per cent increase in total interest income to Sh2.2 billion as the lender expanded its loan book to Sh47.1 billion in March, up from Sh39.5 billion in December.
Its interest expenses jumped 34.2 per cent to Sh743.2 million, reflecting a rise in customer deposits that increased by a fifth to Sh81.7 billion.
National Bank also gained from higher transaction-based income that rose the fastest at 41.1 per cent to Sh854.4 million. The bank’s performance came amid a sharp rise in bad debts that could weigh down its near-term earnings.
The lender said its non-performing loans rose 60 per cent to Sh5.1 billion, a move that saw the lender raise its loan loss provision to Sh1.8 billion from Sh1.3 billion.
The surge in bad debts adds to challenges faced by National Bank which is set to raise Sh10 billion in a rights issue, with part of the cash to be used in retiring the 1.13 billion preference shares held by NSSF and the Treasury.
