Mid-tier lender, NIC Bank, has reported a 10 per cent growth in net profit in the first half of 2015 following diversification of lending to the retail segment. The bank, which has previously focused on lending to corporates, reported an after tax profit of Sh2.4 billion in the first half of 2015, a 10 per cent jump from Sh2 billion recorded in a similar period in 2014.
The loan book grew by 18 per cent to Sh108.3 billion from Sh91.5 billion. Total interest income rose by 16 per cent to Sh7.7 billion from Sh6.7 billion in the period under review.
Operating expenses rose more aggressively by 33 per cent to Sh3.3 billion from Sh2.48 billion while total interest expenses grew by 11 per cent to Sh3.2 billion from Sh2.88 billion in the period under review.
The lender, which has historically focused on corporate banking, is now shifting focus on growing its retail business with the recent appointment of a director to drive growth in the retail and small and medium enterprises market sector.
“The bank has performed well over the last quarter and we are seeing good momentum in the business, especially our retail and SME segments,” NIC Group managing director John Gachora said.
In the half year period, customer deposits grew by 12 per cent to Sh105 billion from Sh93 billion in a similar period in 2014 owing to increased branch network and focus on SMEs and the retail market segments.
Mr Gachora said the bank was keen on managing financing costs and operating expenses going forward. The bank has presence across East Africa with subsidiaries in Tanzania and Uganda.