Barclays records 13pc growth net profit to Sh4.2 billion

Barclays Bank of Kenya recorded a 13 per cent growth in its net profit in the half year ended June, helped by increased lending. The bank’s net earnings stood at Sh4.2 billion in the period compared to Sh3.7 billion the year before, with its interest income growing six per cent to Sh11 billion.

The higher interest income was driven by increased lending that saw Barclays’ loan book rise 21.3 per cent to Sh128.4 billion in June from Sh107 billion in the same month last year. Most of the new lending came in the second quarter, with the bank’s newfound lending appetite expected to significantly grow its interest income in the second half.

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Barclays did not declare an interim dividend, citing the need to preserve cash as it moves to comply with higher capital adequacy ratios set by the Central Bank of Kenya.

“We are not recommending an interim dividend. This will however not affect our full year dividend pay-out ratio which we expect to maintain at 50 per cent (of net profits),” said Yusuf Omari, Barclays’ chief financial officer.

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The bank’s stock has gained 1.1 per cent in the past six months to trade at Sh17.

Barclays’ CEO Jeremy Awori said the lender will in the near term focus on increased lending to the SME segment besides setting up new business lines, including an investment banking arm to play a bigger role in the debt and equity capital markets as well as mergers and acquisitions.

He also announced plans to open a mortgage centre to help increase lending to home buyers.