NAIROBI, Kenya, Mar 31 – I&M Holdings has reported a 21 percent decline in its 2020 after tax profit from Sh10.77 billion in 2019 to Sh8.41 billion in 2020, on account of the impact of the coronavirus pandemic.
In a statement, Daniel Ndonye, the I&M Holdings PLC Chairman noted that 2020 was one of the most challenging years that the Group had witnessed.
During the period, the Group’s net Non-Performing Assets (NPAs) recorded a decline of 10 percent to Sh7.84 billion.
Net interest income recorded a marginal growth of 1 percent to Sh15.59 billion up from Sh15.5 billion in December 2019 attributed to increased focus on growing quality interest earning assets.
Additionally, the Group made a strategic effort to push uptake and usage of its alternate banking channels by giving concessions to encourage customers to utilise these channels for their banking transactions.
As a result, the Group’s total Non-Interest Income recorded a marginal but steady growth year on year.
The bank also recorded a 14 percent growth in its balance sheet size for its 2020 Full Year Financial Results, up from Sh315.2 billion in 2019 to Sh358.09 billion in 2020, bolstered largely by growth in customer deposits.
“We rose above the challenges by looking at new dimensions that would help sustain the Group’s business performance across the countries that we operate in. Key among them was to ramp-up efforts in our digital transformation journey and strategic expansion initiatives.”
During the period under review, the Group instituted a raft of measures aimed at cushioning them from the COVID-19 crisis.
Key among them was increased financing to businesses supporting COVID-19 mitigation measures, waiver of fees of select loans like Mortgages and loan repayment holidays for its lending customers.
The Group’s lending book therefore recorded a growth of 7 percent compared to December 2019, to close at Sh187.3 billion up from Sh175.3 billion for the similar period last year.
Last year, the Group announced the planned acquisition of Orient Bank, Uganda which is subject to receipt of regulatory approvals and expected to close in Q2-2021.
Additionally, in an effort to ensure that clients receive the right solutions based on their financial and lifestyle requirements, the Group made a strategic effort to optimise its operating model across its entities in key areas in decision making such as enhanced data analytics models.
In addition, the Group continued to make investments in ICT infrastructure so as to support its innovation engine for market driven solutions and to also improve operational efficiencies.
The Group’s regulatory ratios have also remained healthy despite the challenging environment.
Its liquidity, from financials sets published, remained above 45% through the year, while the regulatory capital minimums held well above the set regulatory minimums and internally set thresholds.
The Group’s Board also proposed a dividend of Sh2.25 per share as well as a bonus issue of one new fully paid up bonus share of a par value Sh1.00 for every one ordinary shares of par value Sh1 affirming its commitment to continue enhancing its shareholders’ value.
The entity’s subsidiaries also supported the overall performance contributing 6 percent of the overall profit before tax.
Sarit Raja Shah, Group Executive Director, noted that the I&M Group will continue to take advantage of opportunities presented within the subsidiaries and other countries as and when they arise to boost the Group’s performance.