NCBA profit jumps 77pc to Sh4.7b as customer transactions rise

John Gachora Group Managing Director NCBA Group PLC speaking to journalists during annual, SME Day dubbed “Inua Biashara Day” at the Safari Park Hotel [Wilbeforce Okwiri, Standard]

NCBA Bank has reported a 77 per cent increase in net profit over the half-year to June 2021, continuing the trend in the banking industry that has seen players register huge growth in profit.

The group attributed the growth to a surge in customer transactions and a decline in loan impairment.

The bank’s profit grew to Sh4.66 billion over the six months, up from Sh2.63 billion over a similar period in 2020. Customer deposits reached Sh437 billion, a 12 per cent growth year on year.

The group’s asset base rose to Sh542 billion as of June this year, a six per cent increase year on year.

Loan impairments charges for the period stood at Sh5.9 billion, a decline of 22 per cent year on year from Sh7.63 billion in June last year.

The bank also adopted a cautious approach in lending, which resulted in its loan book shrinking to Sh239.6 billion as of June 2021 in comparison to June last year when loans and advances to customers stood at Sh248.3 billion. It increased the money lent to the government through Treasury bonds and bills to Sh102.69 billion in June this year from Sh89.75 billion.

“Our operating results in the first half of the year demonstrates that the actions we have taken to strengthen and enhance the group’s performance are bearing fruit. We have made a concerted effort to reduce the risk in our credit portfolio while balancing the need to support our customers during this Covid-19 period,” said NCBA Group Managing Director John Gachora.

“Over the last year, we have taken the bold step to restructure 35 per cent of our credit portfolio and 82 per cent of that restructured portfolio is now performing.” The bank said it disbursed Sh272 billion in digital loans, a 16 per cent increase year on year.