Connect with us

Hi, what are you looking for?

Capital Business
Capital Business
However, the mortgage lender posted an 11 percent growth in profit after tax of Sh133.6 million from Sh120.1 million/FILE

Kenya

HF profit grows despite drop in sales

However, the mortgage lender posted an 11 percent growth in profit after tax of Sh133.6 million from Sh120.1 million/FILE

NAIROBI, Kenya, Apr 25 – High interest rates that adversely affected mortgage uptake saw Housing Finance report a 38 percent drop in sales in the first quarter to Sh2 billion compared to Sh3.3 billion posted last year.

However, the mortgage lender posted an 11 percent growth in profit after tax of Sh133.6 million from Sh120.1 million.

Cost management and credit risk measures are some factors the mortgage financier has credited to the growth.

The financier’s mortgage interest income grew by 46 percent to Sh951 million against Sh651 million posted during the same period last year.

To sustain this growth, Housing Finance Managing Director Frank Ireri said the firm will focus on risk management and operational efficiency through various cost management initiatives.

“This growth came in a year when the business is facing several challenges including high cost of funds, high cost of living and high inflationary pressure brought on by increasing costs of goods and services,” Ireri said.

In addition the firm’s Net Non Performing Advances to Gross Advances ratio reduced from 4.4 percent to 3.4 percent during the year.

Housing Finance has shifted focus to long term funding to deliver affordable solutions for its middle to lower income target market.

The firm recently signed an international financing agreement for Sh2.2 billion with the European Investment Bank for funding eligible SMEs in the construction industry.

It is currently in talks with other financiers for funding lines for the business, which should the lender hopes, will reduce reliance on short term deposits.

Advertisement. Scroll to continue reading.
Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...