NAIROBI, Kenya, Oct 29 – KCB Group has received approvals to begin operations in Ethiopia as it seeks to deepen its regional expansion.
The bank said on Thursday that authorities in Addis Ababa had granted clearance to run a Representative Office.
At the moment, KCB’s international business includes Uganda, Rwanda, Tanzania, Burundi and South Sudan.
“The new strategy adopted for the international business is gaining momentum and underpins our regional expansion model,” KCB Group CEO Joshua Oigara said while announcing the bank’s performance in the last nine months ending September 2015.
The bank hopes to use its presence in Addis Ababa to facilitate trade between Ethiopia and other East African countries while playing part in driving economic expansion in the country.
In 2013, Kenya signed a special status agreement (SSA) with Ethiopia, giving Kenyan companies the highest possible access to the country and focusing on areas of trade, investment, infrastructure and food security.
The lender’s profit before tax climbed 10 percent to Sh19.4 billion in the nine months ending September 2015. The earnings were buoyed by a substantial growth in net-interest income, fees and commissions and cost management initiatives.
KCB’s International Business grew by 74 percent year-on-year to contribute 12 percent of the Group’s profit, compared to 7 percent in the same period last year.
“Across the six markets we operate in, while we experienced a relatively challenging economic environment on the overall, we have seen the business show great resilience arising from our deliberate focus on prudent cost-management and efficiency in operations, a trajectory we expect to continue in the remaining part of 2015,” Oigara said.
Net interest income increased by 10 percent due to growth in the bank’s asset book partially impacted by the high cost of funds especially during the last quarter of September 2015, while gross fees and commissions grew by 14percent, attributable to new products and alternative channels tailored to meet customer needs and increased transactions volumes.
Total assets grew by 34 percent in what saw the bank’s balance sheet clock Sh607.3 billion up from Sh451.6 billion recorded in September last year.
KCB hopes to ride on its strong balance sheet, diversified products and expansive regional and national footprint to deepen its financial inclusion agenda in the existing and into four new markets by 2020.