HF Group Managing Director Frank Ireri attributed the rise in profit to interest income from the banking and mortgage lending subsidiary Housing Finance Company/FILE
NAIROBI, Kenya, Feb 25 – Integrated financial and property services provider Housing Finance (HF) Group has posted a 23 percent increase in net profit of Sh1.2 billion in financial year ended December, 31 2015 from Sh975 million in 2014.
HF Group Managing Director Frank Ireri attributed the rise in profit to interest income from the banking and mortgage lending subsidiary Housing Finance Company (HFC) and profits from sale of properties by HF Development and Investment (HFDI) during the year.
Net interest income grew by 19 percent to Sh3.6 billion from Sh3 billion while Total non- interest income increased to Sh1.171 billion from Sh843 million representing a 39 percent increase on account of increased house sales during the year.
“HFDI has posted good growth following the completion and sale of houses from some of the key projects that we have been undertaking. During the year the subsidiary completed 500 residential units (Komarock 5B, Precious Gardens phase 1, Kahawa Downs), 1 retail commercial development (K-Mall) and also launched the construction of Komarock Heights phase 1 which comprises 480 residential units,” Ireri said.
Operating expenses increased by 37 percent to Sh2.6 billion from Sh1.9 billion in 2014 on account of increase in staff, marketing and IT costs incurred as part of the ongoing growth strategy.
Gross Non-Performing Loans ratio declined to 7.7 percent from 9.5percent as a result of continuous collection on NPL accounts as well as improved credit underwriting and monitoring practices during the year.
Loans and advances to HFC customers increased by 17.2 per cent to Sh53 billion from Sh45.2 billion in the previous year following continued uptake of new banking products.
This is the first time that the company is reporting its financials as a Group, having restructured in August last year.
Following the move, a non-operating holding company, HF Group, was created and the mortgage and banking business moved to a new subsidiary HFC.
In addition to HFC, the Group’s other subsidiaries include HF Development and Investment (real estate development), HF Insurance Agency and HF Foundation.
The restructure was aimed at enabling the company to optimally achieve its growth agenda.
