Absa Bank has reported net profit of Ksh. 6.3 billion for the half year 2022, this represents a 12.9 percent rise from Ksh. Sh5.6 billion in a similar period last year.
The rise in profitability was on the back of higher yields from loans and advances as the bank adjusted to prevailing lending rates and increased lending to private sector. The higher rates and increase in lending pushed up the banks’ interest income 21 percent to Sh14 billion. Non-funded income rose by 10 percent to Sh6.4 billion on higher returns at the foreign currency market. Non-interest income also grew by 7 per cent to Sh281.6 billion.
On the other hand, higher staffing pushed up the lenders costs that jumped 11 per cent to Sh8.8 billion. Loan loss provision costs also jumped 52 percent from Sh1.9 billion to Sh2.9 billion on forward looking standards requirements and reversal of the huge provisioning cuts done in a similar period last year.
Jeremy Awori, Absa Bank Kenya CEO indicated that they plans to further diversify revenues by increasing investment in areas it has limited presence including asset management, consumer payments, custody business and investment banking with an eye on advisory, mergers and acquisition.
“We are looking to increase our presence and commercialize new business to get into banking tools where we are limited and focusing on key areas of strategic opportunities,” Mr Awori said.
The lender has been aggressive on its growth into a customer-centric lender and hired over 200 workers in sales and marketing roles.