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Barclays nine-month profit drops to Sh5.3Bn amidst customer deposits growth

Barclays Bank Kenya, Managing Director, Jeremy Awori says the period was characterised by harsh economic conditions, political uncertainties and the impact of interest rates caps.

NAIROBI, Kenya, Nov 23 – Barclays Bank of Kenya has posted a profit of Sh5.3 billion net profit for quarter three of 2017 compared to Sh6.1 billion same period in 2016, a 12 percent drop.

Barclays says the period was characterised by harsh economic conditions, political uncertainties and the impact of interest rates caps that came into law in September 2016.

Customer loans went up by 5 percent to Sh167 billion which was mainly driven by a 5 percent and an 8 percent growth in the Consumer bank and SME bank businesses respectively.

“This year has presented us with a multiplicity of challenges on the macroeconomic and political fronts which have had a direct impact on our revenues. The prolonged electoral period has presented a climate of uncertainty which has been challenging for businesses whilst the interest rates law continues to undermine our interest income. We are however optimistic that both of these situations will be resolved soon,” said Jeremy Awori, Managing Director, Barclays Bank of Kenya.

Customer deposits grew by 11 percent to Sh200 billion mainly driven by transactional accounts.

According to the company, this was largely due to the impact of the interest rates’ law that resulted in yields on interest-earning assets declining from 14.2 percent to 12.6 percent and net interest margin (NIM) dropping to 9.3 percent from 10.0 percent in September 2016.

Awori says that the company is now focussed on developing innovative solutions faster than before in order to address our clients’ needs and therefore remain relevant.

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