Income from loans and advances increased by Sh569 million to Sh3.66 billion up from Sh3.09 billion in 2012 while total loans portfolio increased by Sh4.6 billion to Sh33.4 billion up from Sh28.8 billion posted in 2012.
Total operating income increased by 41 percent to Sh2.2 billion compared to Sh1.56 billion posted during a similar period in 2012 and customer deposits also increased by Sh1.9 billion to Sh25.9 billion up from Sh24 billion in 2012.
Housing Finance Managing Director Frank Ireri says the growth was largely driven by growing customer numbers, real estate investment and product innovation.
“The company will continue to focus on organic growth and on connecting with customers through building strong lasting relationships and providing them with a wide choice of relevant investment solutions,” said Ireri.
He said the firm is in the process of rolling out a new core banking system that will improve efficiencies and deliver new product offerings.
“The new banking system will be a next generation banking system, designed on a scalable way, so that it can be tailored to the changing needs of our customers,” Ireri said.
He said that the company is banking on the recently introduced “EZESHA” a product that provides financing of up to 105 percent of the property value, which is expected to increase uptake of mortgage especially in the middle to lower end of the market, which is largely untapped.
Ireri said the property development subsidiary, Kenya Building Society, had successfully completed construction of the Komarock Phase 5A estate comprising 162 housing units.
The subsidiary will soon unveil a proposed commercial centre development in Komarock.
Ireri said despite a stable macro-economic environment, key concerns during the year remain Inflation threat mainly due to food and fuel, monetary policies and operationalization of the National Land Commission.
The net Non-Performing Loan (NPL) book increased to Sh2.4 billion up from Sh1.4 billion in 2012 due to change of laws particularly those contained in the new Land Act relating to the recovery process as well as impact of high interest rates that prevailed during most of 2012.
The firm expects the NPL to reduce in the next quarters following reduction of the lending rates due to a stable macro monetary policy environment.
Total operating expenses increased to Sh1.3 billion up from Sh1billion due to an increase in staffing, loan loss provision and inflationary adjustments.
The firm increased its portfolio of borrowed funds by Sh6 billion to Sh14.8 billion up from Sh8.7 billion.