KCB Bank Reports KSh 29.9 billion in Profits in H1 2024
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KCB Bank profits rose to KSh 29.9 billion in H1 2024, an 86 percent increase from the Ksh 16.1 billion recorded during the same period in 2023.
This was despite the challenging economic landscape characterized by nationwide Gen Z protests, a depreciating shilling, and flooding across the country.
“We delivered a commendable first half of the year, despite strong headwinds in the operating environment, especially in Kenya, thanks to the goodwill and confidence from our customers and commitment by our staff,” noted Paul Russo, KCB’s chief executive.
Driving the bank’s profitability was a substantial increase in interest income, which rose by 38.9 percent to KSh 97.4 billion. Additionally, non-interest income improved by 20.8 percent, reaching KSh 33.3 billion.
Combined, these factors propelled total operating income to KSh 94.6 billion, highlighting KCB’s exceptional performance during the period.
The bank’s loan portfolio expanded to KSh 1.03 trillion, marking a 7 percent increase from the previous year. This milestone represents the tenth consecutive year of growth in KCB’s lending activities, a testament to its strong market position.
However, the bank also experienced a 16.5 percent rise in non-performing loans, from KSh 182 billion to KSh 212.1 billion. To mitigate this, KCB increased its loan loss provision to KSh 12.2 billion.
KCB’s total assets reached a new high of KSh 1.97 trillion, reflecting a substantial growth of 112.3 billion. Customer deposits also saw a modest increase of 1.3 percent to KSh 1.49 trillion. Notably, both assets and deposits have experienced continuous growth for a decade.
“KCB Group demonstrated remarkable strength and adaptability amid global and local challenges, by delivering good asset growth and improved capital adequacy ratios,” said Joseph Kinyua, chairman at KCB Group.
Read: KCB Reports Progress on Climate Action and Social Programs in 2023 Sustainability Report
While the bank’s profitability and growth were impressive, there were also areas of concern. Interest expense rose by 46.5 percent to KSh 36.1 billion, and operating expenses increased by 9.6 percent to KSh 44.3 billion.
Despite these challenges, KCB’s shareholders’ funds increased by 14.1 percent to KSh 241 billion. “This performance has enabled the board to recommend an interim dividend of Sh1.50 per share,” stated Joseph Kinyua.
The bank’s cost-to-income ratio stood at 46.8 percent, indicating a relatively efficient operating model.
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