BY Antony mutunga
NCBA Group is set to pay an interim dividend of Sh2 per share, translating to a total payout of Sh3.29 billion thanks to a profit after tax of Sh7.8 billion compared to Sh4.7 billion same period last year, representing 67% growth.
While the lender experienced revenue growth in most areas, non-interest income was particularly strong because of “an outperformance in foreign exchange” revenues. Moreover, a strong customer base and the bank’s ability to source, risk manage and supply foreign currency, made it possible for the bank to become a top earner of foreign exchange revenues during the period.
According to John Gachora, the managing director of NCBA Group, the results reflect the outcomes of the strategic actions that the lender has taken to support customers navigate the current macro-economic environment and a confirmation that the merger is bearing the fruits of its promise. He largely attributes the growth in profitability to increase in operating income, strong expense management and a decline in impairment charges.
“We have been deliberate in our effort to drive a diversified business serving a wide spectrum of customers,” said Mr. Gachora. “We have provided an enabling environment for businesses to continue to thrive by increasing our product portfolio and tailoring solutions to suit every customer’s needs especially during this period which experienced challenges from the Russia/Ukraine war and risks emanating from the political calendar. Through our digital banking partnerships (M-Shwari, Fuliza, Mpawa, Mokash and Momokash), we continue to provide much needed financial relief to many families and small businesses.”
NCBA embarked on an ambitious branch expansion agenda last year which has seen it open 18 branches across the region in the last 18 months. This year alone, it has opened four branches in Busia, Utawala, Kenol and River Road, with plans to open seven more branches by the end of the year.
“Opening of these branches creates job opportunities across the country and helps us take our services closer to the people. We believe that this wider distribution network allows us to contribute directly to the country’s economic growth agenda. The retail expansion is supported by continuous review of our products and services to make them more attractive and problem-solving to the communities we serve,” said Mr Gachora.
The 15 seconds pre-conditional approval on asset finance through which customers are able to get indicative approvals within 15 seconds of completing an online application is a milestone for the lender. The program has seen a strong uptake and already over Sh2.5 billion has been approved through the channel.
The 11.9% promotional mortgage campaign to customers that will run until the end of October and has recorded customer uptake valued at Sh3 billion also gives the bank an advantage.
NCBA also became the first bank to finance electric vehicles as part of its green strategy by injecting Sh2 billion in asset finance, a move that the lender says will bolster its asset quality and support government’s effort to reduce carbon emissions in the country.
“This period has demonstrated that the strategy that we put in place to ensure that we power and inspire the growth of our customers looking to improve their economic livelihoods is working. We remain focused on supporting our customers’ ambitions as we collectively work towards creating more opportunities for businesses and individuals to thrive,” Gachora explained, adding that the Group remains optimistic with regard to overall macro-economic outlook.
For that reason, the lender will continue to invest in the region while supporting the citizens’ dreams for a prosperous future. He emphasized that with the likely conclusion of the elections in Kenya, the region’s economy is set to benefit from “transition dividends”.
“The Group remains committed to support the various governments and citizens in their overall growth priorities,” he said.
