KCB Group has announced a 15 per cent growth in the third quarter net profit to Ksh 15.9billion, keeping the lender slightly ahead of close rival Equity Bank.
Kenya’s largest bank by assets reported net earnings of sh 13.9 billion in the same period to September 30 last year.
The bank’s group chief executive Joshua Oigara said the performance was driven by strong growth in interest income as KCB saw this revenue stream grow by 7.8 billion to 36.1 billion, representing a 27percent increase.
“The performance reflects continued resilience across the seven markets that we operate in. The business benefited largely from a diversified income structure, prudent cost management and deliberate investments in infrastructure and digital channels,” Said Mr Oigara when he released the results on Tuesday.
KCB’s net loans and advances during the period increased five per cent to sh 364.5billion while customer deposits went down seven per cent to close the period at sh 436.8billion. The growth was largely driven by the Kenyan business which registered an eight per cent growth.
The results have positioned KCB neck and neck with its tier one rival Equity Bank which posted an 18 per cent rise in after-tax profit for the nine months ended September to sh 15billion.
Mr Oigara said KCB will weather the new interest rate capping that is expected to thin margins for lenders. He noted he devaluation of the South Sudan pound negatively impacted on the lender’s group deposits. However, customer deposits went up 14 per cent on the back-capital flight to perceived safety, he said.
The lender plans to upscale efforts towards enhancing its digital platforms as more of its customers move away from stone and brick branches. As part of the plan, Mr Oigara said new investments will be made on the KCB’s mobile banking unit
“The number of users of our mobile banking channel stands at 10.2 million while the number of mobile accounts grew by 98per cent from 4.3 million in quarter three of 2015 to 8.3 million in a similar period this year. As such the registered customers on mobile make up over 75 per cent of the total customer base in the bank,” said Mr Oigara
Despite the focus on mobile, Mr Oigara assuaged fears that the shift to digital banking would lead to workers’ redundancies. He stated that the bank would not open any new branches nor shut down any existing ones.