KCB first-half pre-tax profit rises 16 pct, bad debts grow

Money Markets 

KCB Group CEO Joshua Oigara (right) and chief financial officer Collins Otiwu during the bank's full-year 2013 results briefing on February 27, 2014. Kenya Commercial Bank has posted a 16 per cent rise in half year profit before tax. Photo/SALATON NJAU   Nation Media Group

By DUNCAN MIRIRI, Reuters

In Summary

• Kenya Commercial Bank has reported a 16 per cent rise in first-half pretax profit to Sh11.7 billion.
• Bad debts were more than targeted at 8.8 per cent, with full-year target for NPL ratio at 6 per cent.

Kenya Commercial Bank has reported a 13.8pc rise in first half net profit to Sh8.2 billion, from Sh7.2b for a similar period in 2013 on increased revenue from alternate banking channels.

Pre-tax profit was up 16 per cent to Sh11.7 billion.

 

Bad debts were more than targeted at 8.8 per cent of the portfolio, Chief Executive Joshua Oigara said, adding the outlook had brightened after the government paid contractors following earlier delays.

The full-year target for non-performing loans (NPL) ratio was 6 per cent, but Oigara said he hoped the level could be brought lower.

"The internal target is 4.5 per cent for the NPL ratio," he told an investor briefing in Nairobi Thursday.

Fees and commission income rose 13 per cent to Sh5.67 billion, while income from foreign exchange trading rose 25 per cent to Sh2.22 billion. Net interest income rose by seven per cent to Sh17.13 billion.

KCB, the country's largest bank by assets, also operates in Tanzania, Rwanda, Uganda, South Sudan and Burundi.