KCB Group PLC recorded Sh45.8 billion in profit after tax for the nine months to September 2024, driven by sustained revenue growth. This is a 49 per cent growth from Sh30.7 billion posted in a similar period last year. Revenues increased by 22 per cent to Sh142.9 billion, bolstered by both funded and non-funded lines across the subsidiaries.
This pushed the lender’s balance sheet to Sh2 trillion up from Sh1.5 trillion, retaining the market leadership in East and Central Africa. Foreign exchange income, transaction fees and strong revenues from Trust Merchant Bank (TMB) boosted non-Funded Income (NFI) in the Democratic Republic of Congo.
The contribution by subsidiaries (excluding KCB Bank Kenya) improved during the period, closing at 36.6 per cent in profit after tax and 34 per cent in total assets, a demonstration of the continued benefits of diversification to other markets outside Kenya. KCB Group CEO Paul Russo said the Q3 results defied the tough operating environment across markets.
We have continued to walk the journey with our customers while ensuring our key fundamentals remain strong. We are optimistic of a strong end of the year, riding on improving market conditions, solutions for customers and tapping the great strength of our people, Russo told investors on Wednesday.
We have made deliberate investments to support regional trade and connect millions of people across the world to opportunities on the African continent and beyond whilst making a positive social impact in the communities.
Net loans and advances ticked up quarter on quarter to Sh1.1 trillion benefiting from growth in retail sector lending that outpaced the impact of the appreciation of the shilling on foreign currency-denominated loans.
The results show that net interest income grew by 24 per cent supported by improved yields and increased lending to key segments, significantly offset by an increase in interest expense driven by the high cost of funds.
Total operating costs, however, grew 11 per cent driven by higher staff costs, technology expenses, spending related to business volumes and continued prudent provisioning for Non-Performing Loans (NPL).
The stock of NPLs stood at Sh215.3 billion, which saw the NPL ratio close the quarter at 18.5 per cent, reflecting the economic conditions in different sectors across the markets. The high NPL ratio saw the bank increase provisions by 12.2 per cent.
