Diamond Trust Bank Kenya reported a robust 9.9 per cent increase in net profit for the first quarter ending March 2025, reaching Sh3.23 billion, up from Sh 2.94 billion in the same period last year.
The growth was primarily fuelled by disciplined cost management and a strong cost-to-income ratio, even as non-interest revenues faced significant headwinds.
Net interest income rose by 7.98 per cent to Sh 2.26 billion, driven by a 6 per cent expansion in the loan book, which grew to Sh 284.26 billion. On the other hand, non-interest income declined sharply by 18.5 per cent to Sh 3.02 billion, down from Sh 3.71 billion in Q1 2024. This drop was partly attributed to a significant decrease in foreign exchange trading income, which fell to Sh 745.95 million.
Operating expenses also decreased by 2.9 per cent to Sh 6.62 billion, largely due to a substantial 42.7 per cent reduction in loan loss provisions. Provisions fell to Sh 886.26 million from Sh 1.54 billion, despite gross non-performing loans increasing to Sh 39.68 billion from Sh 37.85 billion.
However, staff costs increased significantly by 20.2 per cent to Sh 2.71 billion, reflecting both salary increments and an expanded workforce following the branch network growth in 2024.
DTB’s results come against a backdrop of shifting market dynamics. The period saw falling interest rates and reduced volatility in the Kenyan shilling’s exchange rate, compared to the elevated levels experienced throughout much of 2024.
While DTB managed profit growth, the decline in non-interest income mirrors challenges faced by other banks in the current lower-rate environment, supported by the Central Bank of Kenya’s rate cuts amid stable inflation (within the 2.5 to 7.5 per cent target band).
The bank continued its physical expansion strategy, adding six branches in 2024 and bringing its total network to 158, up from 152. This expansion—aimed at enhancing customer access, particularly in rural areas—contributed to a net increase of 100 employees group-wide, raising the total headcount to 2,586.
Reflecting confidence in its performance and outlook, DTB Group has announced plans for a record dividend payout for 2024. Shareholders at the upcoming Annual General Meeting next month are expected to approve a dividend of Sh 7 per share. This follows an 11 per cent increase in 2024’s net profit to Sh 7.64 billion.
The total proposed dividend payout of Sh 1.96 billion marks an increase from the Sh 1.68 billion paid out for 2023, based on a net profit of Sh 6.88 billion. The proposed Sh 7 per share dividend is the highest in DTB’s history, more than double the Sh 3 per share paid for the year ended December 2021.
This progressive dividend growth reflects DTB’s ongoing commitment to balancing capital retention for future growth with rewarding shareholders as performance improves.
– By Nusurah Nuhu
