A KCB banking hall. A review of the unaudited financial statements
reveals that the lender was heavily affected by staff rationalization
costs, interest rate caps and the conflict in South Sudan forcing the
bank to shut some branches. PHOTO | FILE | NATION
Regional lender KCB Group’s net profit for the first half of the
year fell marginally by 0.2 per cent on account of staff costs and
conflict in South Sudan.
The bank’s profit after-tax
dropped to Ksh10.26 billion ($102.6 million) in the first six months to
June 2017 compared to Ksh10.28 billion ($102.8 million) for a similar
period last year.
A review of its unaudited financial
statements for the period shows that staff layoff, interest rates
control and conflict in Juba that forced it to closed some of its
branches in the war-torn country, were some of the issues that ate into
its income.
In
February, KCB issued about 500 employees with offers for early
retirement. As a result, the bank's staff costs rose by 12 per cent to
Ksh9.08 billion ($90.8 million)
from Ksh1 billion ($10 million) a year earlier.
Its
interest income from loans and advances fell by seven per cent to
Ksh23.94 billion ($239.4 million) from Ksh25.71 billion ($257.1
million).
The Group’s total interest
income sank by four per cent to Ksh30.36 billion ($303.6 million), while
operating expenses grew by eight per cent to Ksh16.9 billion ($169
million).
The stock on the Nairobi
Securities Exchange (NSE), however, remained steady at Ksh39.50 ($0.39)
per share at the close of the trading session on Wednesday.
The Group's chief executive Joshua Oigara said the lender is banking on its digital channels to boost earnings.
“The
business fundamentals remain strong and we are optimistic of a stronger
performance in the remaining part of the year,” said Mr Oigara.
The bank has proposed an interim dividend of Ksh 1 ($0.01) per share to be paid in the next 90 days.
Related stories:
No comments :
Post a Comment