Barclays Bank of Kenya has reported a 6.2 % increase in profit after tax to Ksh 3.8 billion for the period ended 30th June 2018.
The performance was mainly attributed to a 5 per cent growth in total income but was partially offset by 3 per cent and 27 per cent in costs and impairments.
Customer deposits grew by 15 per cent to Ksh 217 billion with transnational accounts constituting 66 per cent of the total deposits.
Operating expenses less loan loss provisions rose 2.7% to Ksh 8.7 billon mainly attributed to 15.1 % rise in other operating expenses to Ksh 2.3 billion and a 0.4% marginal decline in staff costs to Ksh 5.1 billion.
The bank increased their lending to government to 70 billion while loans to customers remained even from the same period last which is attributed to the interest rate capping in September in 2016.
Total nonperforming loans and advances increased to 10.93 billion in the period ended in June compared to 8.78 billion in the same period last year.
The bank will pay an interim dividend of Ksh0.20 per ordinary share
The bank launched a number of products during the period under review, including its mobile lending app dubbed Timiza. The bank says Timiza has hit the 2 million customer mark in just 130 days.
Impairment
Impairment increased by 27% compared to similar period last year largely attributable to adoption of IFRS 9 and also a few client names.
Implementation of IFRS 9 took effect in January 2018 with robust models put in place to aid in the rollout and assessments on an ongoing basis. We passed the increase in IFRS 9 stock through reserves with the impact estimated to be in the region of 30% increase in impairment stock. We have adequate buffers to cushion the Bank from the provisions impact.
- Kenyan Wallstreet
