KCB Group has posted a 5% growth in after tax profit to KShs. 12.7 billion for the first half of 2019 ending June compared to KShs12.1 billion reported same period last year due to growth in its loan book and increased mobile channel activity.
KCB Group CEO and MD Joshua Oigara, while releasing the results on Thursday, said channel transactions done outside the branch increased to 96% of total transactions, up from 87% in 2018 driven by mobile channel.
“We had a strong second quarter and witnessed continued growth across our businesses segments. The investment in technology generated positive return and further helped drive efficiency and deepen access to affordable financial services in all markets,” said the Group CEO and MD.
The firm saw a net interest income increase by 5% to KShs. 25.4 billion, attributable to a 14% expansion of the loan book and a marginal 2% increase in the interest expense.
Fees and commissions increased by 31% to KShs. 8.9 billion as revenues from digital channels in particular KCB M-PESA grew significantly powered by the new platform launched late last year. The value of loans disbursed via the service during the period of review increased from KShs. 14.9 billion in H1 2018 to KShs. 66.7 billion in H1 2019.
Total operating income was up 8% to KShs. 38.6 billion from KShs.35.6 billion on the back of strong non-funded income which grew 15% to KShs.13.1 billion. The Group’s balance sheet increased by 12% to KShs. 746.5 billion, with deposits up 7% to KShs. 563.2 billion supported by continued strong growth in personal and transaction accounts.
The loan book surged 14% to KShs. 478.7 billion, reflecting the strong lending pipeline primarily driven by the retail and corporate banking customer segment.
The ratio of non-performing loans to total loans declined to 7.8% from 8.4%, well below the industry average of 12.7%.
Following the results, the Board of Directors approved a payment of an interim dividend of KShs: 1.00 per share. Shareholders will be paid the dividend in November 2019.