National Bank's Q1 pre-tax profit edges up 3pc

Customers at a National Bank branch. Photo/FILE 

By Reuters
 

 

National Bank of Kenya's pre-tax profit rose 3.3 per cent year on year in the first quarter to Sh508.1 million, thanks to a fall in loan loss provisions.

The lender, which is 70 per cent owned by the government and Kenya's state pension fund, will raise funds from the market next year to finance a five-year expansion plan.

The bank's total interest income fell to Sh1.85 billion in the first three months of 2013 from Sh2.27 billion in the same period a year earlier, while net interest income fell to Sh1.29 billion from Sh1.35 billion.

But its bottom line was cushioned by a 52 per cent reduction in provisions for bad debts, which stood at Sh47.5 million during the period.

The bank said loans and advances to customers fell 5 per cent to Sh27.09 billion, while total non-performing loans almost trebled to Sh3.17 billion from Sh1.14 billion.

Total assets rose to Sh83.61 billion from Sh70.17 billion, while total operating expenses fell to Sh1.39 billion from Sh1.42 billion in the first quarter of 2012.

Last week the bank said it planned to raise more than 10 billion shillings in a cash call next year. It will invest Sh400 million in opening 10 new outlets this year and in the acquisition of electronic channels like mobile phone and Internet banking.