KCB posts 21.8pc net profit jump to Sh24bn

KCB Group #ticker:KCB has posted a 21.8 per cent jump in net profit for the full year ended December 2018, helped by lower loan loss provisions and higher interest income.

The lender’s net profit in the review period stood at Sh24 billion compared with Sh19.7 billion the year before.

KCB Group's interest income grew by 4 per cent to Sh66.3 billion from Sh63.7 billion posted at the end of previous financial year.

During this period, non-interest income, mainly from fees and commissions, remained flat at Sh23 billion.

KCB also reduced its provision for bad debt by 50 per cent to Sh2.9 billion, a move that helped to lower its total operating expenses by 4 per cent to Sh35 billion.

KCB Group chief executive Joshua Oigara said this is a strong performance in an interest rate cap regime.

Second lender

KCB becomes the second lender after Stanbic Holdings to announce a growth in full-year results.

Stanbic Holdings on Friday last week posted 45.5 per cent jump in net profit to Sh6.27 billion for the full year ended December 2018 buoyed by growth in both interest and non-interest income.

The results by the two lenders mirror the Central Bank of Kenya (CBK) indicators that show commercial lenders recorded a rise in earnings last year.

Kenyan banks’ total pre-tax profits hit a record high of Sh152.3 billion last year, surpassing the previous earnings peak reported before the introduction of interest rate controls slightly more than two years ago according to the CBK report.