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Kenya

KCB profits shoot up 69 percent

NAIROBI, July 31 – The Kenya Commercial Bank Group Thursday announced a 69 percent growth in pre-tax profits for the first half of 2008.

Chief Executive Martin Oduor-Otieno told an investor briefing that the bank recorded Sh3.5 billion profits before tax between January and June 30, 2008 compared to Sh2.1 billion posted during the same period in 2007.

Although the total operating income increased by 34 percent to Sh8.9 billion, the operating expenses grew by 39 percent to Sh5.7 billion, owing to the rising inflation, staff development and investment in ICT.

“Kenya Commercial Bank (KCB) continues to receive increased business from the market requiring us to invest more in people and infrastructure in order to meet the growing demands,” the CEO explained.

Their balance sheet grew from Sh101 billion in June 2007 to Sh171 billion in June 2008, while net loans and advances increased by 28 percent from Sh55.1 billion to Sh70.4 billion.

The bank’s shareholders will also be happy to note that the bank posted a 19 percent increase in shareholder equity, to Sh14.2 billion.

The bank, which is focusing on consolidation and growth, explained that it was on track with its plans to open 50 branches and 76 Automated Teller Machines (ATM) by the end of 2008.

The announcements come after the bank concluded its Rights Issue, where it hoped to raise Sh5 billion – (results will be announced next week).

“We are optimistic that we will raise the funds that we require to support the growth and expansion of the bank,” said Oduor-Otieno.

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The institution recently received the Central Bank of Rwanda’s approval to establish a new subsidiary in that market.

Once the Rwandan transaction is complete, the bank will set its eyes on Burundi, as well as other African markets.

“We are confident that we will become the prime financial platform for businesses and individuals across East Africa, as we pursue the vision to be the ‘Best Bank in Africa’,” Oduor-Otieno enthused.

KCB Group joins other banks that have released good half-year results despite the political disruptions experienced in the first three months of 2008.

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