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Kenya

BBK profits up 16 pc

NAIROBI, August 8 – Barclays Bank Kenya (BBK) has announced a 16 percent increase in after-tax profits for the first half of the year, standing at Sh2.8 billion by June 30, 2008, compared to Sh2.4 billion for the same period last year.

Customer deposits went up by 23 percent from Sh105 billion to Sh128 billion, while costs increased by 46 percent.

“The increase in costs should not alarm you as they are a result of our expansion program. But we are now at the point where we are maintaining the costs and increasing income,” explained the BBK Managing Director Adan Mohammed.

He also attributed the results to a 35 percent growth in income, from the Sh8.5 billion posted last year to Sh11 billion this year.

BBK opened 30 branches last year, in an effort to reach less affluent customers. Its network base now stands at 114, and Mohammed revealed that 70 percent of the new branches had broken even.

He further observed that the future of Kenya’s banking industry would depend on how it managed expenses, so as to mitigate on the increased costs of inflation worldwide.

He said sustainability of the bank’s profits will hugely depend on maintaining a good customer base. 

The bank issued a seven-year bond late last year worth a total of Sh5 billion to finance long term lending.

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