Barclays Bank of Kenya yesterday announced their results in which they reported a profit before tax of Ksh. 10.8 bn. This was on the back of an impressive 16% growth in their loan book which was driven by a 33% growth in their corporate book and a 25% growth in their SME book. Their otherwise good performance was however impacted by an increase in impairment due to increased job losses that lead to defaults in unsecured loans as well as the implementation of the Banking Amendment Act in Q4. All these factors led to a drop in their net profit by 12% to 7,111 bn from 8,400 bn in 2015.
During the period under review the bank saw its total revenue grow by 8% to Kshs. 31.7 billion due to strong performance of new income lines such as bancassurance, fixed income trading and customer assets which recorded a 16% growth. Net interest income grew by 9% to Kshs. 22 billion driven by existing clients coming for top-ups in the third quarter. The bank’s decision to diversify its income seems to be paying off because the non interest income grew by 3% supported by Bancassurance, forex income and fixed income trading. Customer deposits also grew by 8% to Ksh.178 billion with upto 80% being non interest earning showing the confidence that their customers have in the bank.
The banks costs went up by 8% to Kshs.17 billion due to inflationary adjustments to staff costs and an increased investment in technology, new channels such as agency banking and the refurbishment of bank branches and ATMs in a bid to improve customer experience. The cost to income ratio stood at 53%. The bank’s capital and liquidity ratios are strong with sufficient headroom above regulatory requirements.