National Bank of Kenya profit growth with 62 percent
National Bank of Kenya (NBK) profit growth with 62 percent before tax for the first half of the year ending June despite the effects of the COVID-19 pandemic.
National Bank of Kenya (NBK) has posted Sh186million in profit before tax for the first half of the year ending June, representing a 62 percent increase from a similar period last year.
However, profit after tax reduced from Sh107 million to a loss of Sh381million due to a one-off tax adjustment after the recent change in corporate tax.
“We remained resilient during the first half of the year, despite the slowdown occasioned by the pandemic. We are replacing non-performing loans with quality ones, and constantly innovating to align with current realities,” said Paul Russo, the NBK Managing Director
“We are focused on delivering valuable partnerships and solutions to our customers. These efforts are bearing fruit as demonstrated by a recent survey of customers, whose overall feedback was an appreciation for our dedication,” added Russo.
The Bank’s total operating income for the period grew by 12 percent to Sh4. 3 billion, driven by increased interest and non-interest income.
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Following the bank’s waiver on charges for transactions on digital channels, as a measure to mitigate the impact of COVID-19, fees, and commissions during the period remained relatively flat. Operating costs were stable on the back of ongoing cost management initiatives.
The Bank’s balance sheet for the period grew to Sh119 billion driven by growth in customer loans and deposits. Customer deposits rose to Sh99.6billion, from Sh91.7billion in a similar period in 2019; with liquidity improving to 50.2 percent from 40.7 percent over a similar period. Loans and advances increased by Sh2.9 billion to Sh50.2 billion.
The Bank’s recovery journey stayed on course during the first half, with the Non-Performing Loans (NPL) shrinking by 12 percent for the period ending June 30, 2020, to stand at Sh28.6billion, compared to Sh32.4billion last year.
NBK has taken measures to cushion customers from negative impacts of the pandemic. This includes restructuring customer loans, in addition to suspending listing on the credit reference bureau and waiver of fees charged on the use of digital channels.