HF Group's net profit for the first three months of trading ended March 2025 rose 2.2 times to Sh327.93 million on the back of increased interest and non-interest income.
The growth in net earning from Sh150.34 million came in the quarter HF’s net interest income rose by 14.6 percent to Sh989.75 million from Sh677.33 million while non-interest income increased by 9.9 percent to Sh424.9 million.
HF Group CEO Robert Kibaara, attributed the performance to the group’s ongoing transformation and diversification strategy, highlighting growth in business banking, property and custodial services.
“We continue to realise the impact of our transformation journey. Our business model has evolved significantly, enabling us to deliver sustainable growth and value to our shareholders. Further, the successful rights issue, which was oversubscribed by 38 percent, has enhanced our capital position, allowing us to power growth as we innovate to meet customer needs,” he said.
The first quarter net profit is equivalent of 62.5 percent of the Sh524.68 million net profit that HF posted in the financial year ended December 2024.
The increase in the operating income was more than the rise in operating expenses to Sh1.07 billion from Sh905. 2 million, helping HF to more than double its profit in the period where the sector’s earnings slowed.
The performance defied an environment of falling interest rates on loans in line with sustained decline in Central Bank Rate. Returns on government paper have also been falling even as foreign exchange income also softened on the back of reduced volatility on the shillings’ exchange rate.
HF booked an 87.6 percent rise in income from securities to Sh595.97 million from Sh317.9 million while income from loans and advances grew to Sh1.18 billion from Sh1.16 billion.
Operating expenses were driven by a rise in staff costs to Sh511.22 million from Sh437.21 million, even as the provisioning for loan losses eased to Sh110.43 million from Sh109.1 million.
HF’s total deposits rose by 16 percent to Sh50.11 billion from Sh43.75 billion, which the lender attributed to increased market confidence after the recent rights issue.
The balance sheet grew by 18 percent to Sh73.4 billion.
