NAIROBI, Kenya, Feb 24 – Barclays Bank of Kenya’s has posted a 1o percent drop in 2016 full year pre-tax to Sh10.8 billion compared to Sh12.07 billion in 2015.
According to the management, the profits were affected by implementation of the Banking amendment Act in the fourth quarter of 2016 as well as increase in loan impairments.
Chief Executive Jeremy Awori attributes the decline to a turbulent macro-economic environment that has caused heightened job losses resulting in higher than usual default rates especially in unsecured loans.
Provisions for bad debts went up by Sh3.92 billion from Sh1.77 billion a year earlier as bad debts nearly doubled.
“We have instituted corrective measures to contain impairment and they are beginning to bear fruit. We have invested in people, processes and systems to manage our impairment better,” Awori says while announcing the results.
The banks’ loan book however increased by 16pc to Sh168 billion while total revenue went up by 8 percent to Sh31.7 billion backed up by new income lines such as bancassurance and fixed income trading.
Net interest income grew by 9per cent to Sh22 billion while non interest income grew by 3per cent.
Customer deposits went up by 8 per cent to hit Sh178 billion while costs went up by 8 per cent to Sh17bn.
“We are investing heavily in the automation and digitisation of our systems, processes and solutions in a bid to make our institutions more efficient,” Awori says.