KCB Group net profit for the first nine months ended September 2024 grew by 48.7 percent to Sh44.5 billion, keeping it ahead of its closest rival Equity Group.
At Sh44.5 billion, KCB’s nine-month net profit is ahead of Equity for the first time since 2020 when Equity posted Sh14.81 billion against KCB’s Sh10.9 billion.
During the review period, KCB net interest income grew by 23.9 percent to Sh92.8 billion as the loan book expanded to Sh1.053 trillion from Sh1.047 trillion.
KCB attributed this to growth in retail sector loans that outpaced the impact of appreciation of the shilling on the foreign currency denominated loans.
Non-interest income rose 18.3 percent to Sh50.15 billion, boosted by foreign exchange income and transaction fees, particularly from Trust Merchant Bank (TMB) —the DR Congo-based subsidiary.
The increase in income was supported by subsidiaries outside Kenya, with their share in net profits closing at 36.6 percent.
The largest subsidiary, KCB Bank Kenya saw a 32.4 percent rise in net profit to Sh31.75 billion, while National Bank of Kenya, which is another subsidiary in the country, recovered from a Sh3.05 billion loss to post a Sh1.19 billion net profit.
“The operating environment has been tough across all our markets, but we have continued to walk the journey with our customers while ensuring our key fundamentals remain strong. We are optimistic of a strong end of the year, riding on improving market conditions, solutions for customers and tapping the great strength of our people,” said Paul Russo, chief executive at KCB Group.
“We have made deliberate investments to support regional trade and connect millions of people across the world to opportunities on the African continent and beyond whilst making a positive social impact in the communities.”
The group’s operating expenses went up by 11.5 percent to Sh85.5 billion, driven by growth in costs such as salaries and provisioning for loan defaults.
KCB increased the loan loss provision by 12.1 percent to Sh17.78 billion while staff costs rose by 10 percent to Sh29.35 billion, coming in the period other operating costs also went up by 18 percent to Sh30.1 billion.
The group’s stock of non-performing loans (NPLs) hit Sh215.3 billion from Sh187 billion, which saw the NPL ratio close the quarter at 18.5 percent from 15.2 percent, reflecting the economic conditions in different sectors across the markets.
KCB Group balance sheet closed at Sh1.993 trillion from Sh2.099 trillion while deposits closed at Sh1.538 trillion from Sh1.656 trillion on movements in foreign exchange rates.
