State-backed mortgage refinancing company KMRC has posted a 163 percent rise in net profit for the year ended December 2023 to Sh847.7 million from Sh321.3 million previously.
The more than two-fold increase in profitability for the Kenya Mortgage Refinance Company is anchored on higher revenues from lending activities during the year.
The company’s annual income has crossed the Sh1 billion mark for the first time, settling at Sh1.3 billion last year from Sh666.4 million previously.
The revenue growth has been achieved on the back of increased lending with loans and advances to customers, who comprise financial institutions such as commercial banks and Saccos, hitting Sh8.4 billion last year from Sh6.7 billion previously.
During the period, KMRC increased its borrowings to support lending by Sh3.8 billion to Sh20.6 billion from Sh16.8 billion in the year to December 2022.
The firm’s cash flows improved across the 12 months as total cash and cash equivalents closed 2023 at Sh11.8 billion from Sh9 billion previously.
KMRC plays the role of providing long-term funds to primary mortgage lenders to increase the affordability of home loans to Kenyans.
The company provides concessional, fixed, long-term finance to the primary lenders, who include banks and Saccos, who then on-lend the funds to consumers as cheap-priced home loans.
The government holds a 25 percent stake in KMRC with banks holding a 44 percent share of the company. Development finance institutions - the International Finance Corporation (IFC) and Shelter Afrique - hold 23 percent while Saccos have an eight percent stake.
Lenders making up the banks’ stake in the company include KCB, Co-operative, Stanbic, NCBA, Credit Bank, DTB, Absa, Housing Finance and KWFT Bank.
11 Saccos share eight percent of the company’s stake and include Stima, Mwalimu, Unaitas and the Kenya Police Sacco.
