Kenya Commercial Bank gives bonus to shareholders after 17 pc profit jump

Kenya Commercial Bank CEO Joshua Oigara. (Photo:File/Standard)

By James Anyanzwa 

Nairobi, Kenya: Kenya Commercial Bank (KCB) Group has declared a bonus of Sh2 per share for its shareholders.

This is after it reported a 17 per cent growth in pre-tax profit for the full year ended December 31, 2013

The Group posted a profit before tax of Sh20.1 billion from the previous year’s Sh17.2 billion, despite a slowdown in economic activities during the first half of the year as a result of the March 4 General Election.

According to the audited financial statements released Thursday, the group’s customer deposits grew six per cent to Sh305.7 billion from Sh288 billion. Net loans and advances went up eight per cent to Sh227.7 billion from Sh211.7 billion in a similar period last year.

The management attributed the better performance to what they considered a ‘favourable’ business environment during the period under review. Chief Executive Joshua Oigara said the bank registered growth in all its business segments.

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Regional subsidiaries

These included growth in transaction-based income and improved performance by regional subsidiaries. International business in South Sudan, Uganda, Tanzania, Rwanda and Burundi contributed a combined 11.5 per cent to the Group’s profit.

Revenues from regional subsidiaries surged 60 per cent to Sh2.4 billion from Sh1.5 billion. Fees and commissions increased 9.2 per cent to Sh10.5 billion from Sh9.6 billion while net interest income grew eight per cent to Sh33 billion from Sh30.6 billion in a similar period.

“The overall operating environment in the year 2013 was favourable for business,” Oigara told an investor briefing in Nairobi Thursday.

He said the bank plans to grow its non-funded income through cross-selling and optimal utilisation of alternative channels such as agency banking, mobile banking, Internet banking, automated teller machines (ATMs) and credit cards.

Inflation figures

During the period under review, inflation figures ranged between 3.2 per cent and 8.29 per cent; Central Bank Rate (CBR) stood at 8.5 per cent and the shilling exchange rate weakened slightly to trade between Sh85 and Sh87 against the US dollar.

Oigara said these macroeconomic fundamentals contributed to financial stability in the market.