, NAIROBI, Kenya, May 26 – The Kenya Commercial Bank Group posted a net profit of Sh4.6 billion in the first quarter of 2016 even as non-performing loans continue to ail the banking sector.
The profit went up marginally from the Sh4.3 billion recorded over the same period in 2015.
The bank recorded Sh26 billion non-performing loans in the period under review, up from Sh18 billion same period last year and Sh20 billion recorded as at December 31, 2015.
“The growth was partially hampered by high cost of funds carried over from 2015 and an increase in provision for doubtful loans,” the bank said in a statement.
Provisions for bad debts went up 149 percent from Sh550 million to Sh1.4 billion compared to same period last year.
Long term debt funding went up by 54 percent from Sh12.72 billion to Sh19.6billion.
Total assets went up by 9 percent to Sh556.8 billion while customer deposits hit Sh423 billion in the period under review.
Net loans and advances went up 16 percent Sh297billion to Sh345.9billion while net interest income was up 24 percent Sh9.3billion to Sh11.4billion.
Shareholder funds stood at Sh83.9 billion.
“We are excited about the continued growth of the business across markets and we are confident that digital payments and mobile money will deliver significant growth for the Group. We see these two as key catalysts in deepening financial inclusion,” said KCB Group Chief Executive Joshua Oigara.
The bank said it will continue making deliberate investments and focus on building a business around diversification, prudent cost management, a robust IT system while remaining synonymous with excellence in customer experience at all service points across the group to boost efficiency.
During the period under review, the bank was involved in repaying Imperial Bank Limited (IBL) depositors together with Diamond Trust Bank after IBL went under.
The bank was also overtaken by Equity Group in the period under review as Equity Group posted Sh5.1 billion net profit up 19.4 percent from same period last year when they posted Sh4.2 billion.