Equity Three-Month Profit Rises To Ksh.11.5 Billion

By Kepha Muiruri For Citizen Digital

Equity Group Managing Director James Mwangi during a past function. PHOTO | COURTESY

Equity Group has posted a 33.7 per cent growth in its 2022 first quarter profit to March with

earnings at Ksh.11.4 billion from Ksh.8.6 billion last year.

The growth in the bank profitability is largely attributable to a rise in revenues for the lender with net interest income growing by 31.1 per cent to Ksh.19.4 billion from Ksh.14.8 billion.

At the same time, non-interest funded income (NFI) has grown by 9.2 per cent from Ksh.10.9 billion to Ksh.11.9 billion.

According to Equity Group Managing Director James Mwangi, the three months’ results reflect the continued momentum of the bank as its client’s base and the region’s economy comes from the strain occasioned by the COVID-19 pandemic.

“The uncertainty has now dialed down and we are nearing pre-pandemic levels of operations. The region now has a stable operating environment,” he said.

“We are inspired by estimates and projections especially for Kenya where we have not seen a 7.5 per cent GDP print in so long.”

Equity Group total assets have grown by 19 per cent over the quarter to Ksh.1.270 trillion with the lender’s subsidiaries now contributing to 40 per cent of the Group’s revenues.

The bank’s loan book has meanwhile grown by 28 per cent to Ksh.623.6 billion from Ksh.487.7 billion last year while investments in government securities have hit Ksh.389.4 billion from Ksh.258.9 billion.

Nevertheless, the Group’s total operating expenses have soared to Ksh.16 billion from Ksh.14 billion.

The rise in costs include a 38.5 per cent growth in loan-loss provisioning costs to Ksh.1.8 billion from Ksh.1.3 billion with the added cover representing general provisions to fortify the new loan book.

Despite recent shocks to the macroeconomic environment including inflation and supply chain constraints, Equity expects its performance to remain resilient going into the half and full year earnings.

“We would like to spin the can and see the concerns as a blessing in disguise,” added Dr. Mwangi.

“The economy continued to grow in the last elections. Kenyans have moved on, the economy has become bigger and the private sector has balanced political concerns.

The Group’s ongoing digitization initiatives have seen the lender’s overall cost of income fall to 45.3 per cent in the quarter.

By Kepha Muiruri For Citizen Digital