Browsing: East African Banks

Banks in East Africa raise bad loans provision to cushion distressed customers

Banks in East Africa are empathizing with the loss of livelihood and businesses of their clients by easing off on loan payment demands as the covid-19 pandemic continues to disrupt economies.

In 2020, top East African banks increased provisions for bad debts by over $736 million so as to reduce exposure on businesses and household loans in countries that are most affected by the pandemic.

According to a review of the banks audited financial statements, in 2019 the top eight Kenyan banks by market share tripled their loan loss provisions to $960 million from $263.11 million.

In order to take care of $1.56 billion worth of loans that had been restructured to bail out clients who were most affected by the pandemic, equity bank increased its loan loss provision by $198.6 million making it the greatest hit on its net earnings that the bank has ever experienced. This led the …