Barclays Bank of Kenya Ltd has reported a profit after tax of Kshs. 5.4 billion for the period ended 30 September 2018, and operating profit of Kshs. 10.5 billion a growth of 5% compared to a similar period last year. The performance is mainly attributable to a 6% growth in total income, but was partially offset by growth of 6% and 21% in costs and impairment, respectively.
Customer deposits grew by 10% to Kshs.220 billion with transactional accounts constituting 66% of the total deposits. The Consumer Banking and Business Banking segments recorded double-digit growth year on year.
Net Customer Loans was up 7% to close at Kshs.178 billion driven products across board that recorded a strong growth year on year performance. The Bank’s deployment of excess funding was underpinned by investment in government securities & dealing securities book which increased to Kes 103billion.
As a result of successful investments and execution of our growth strategy, total income increased by 6% to Kshs 23.9 billion, with non-funded income up 14% year on year
Other Highlights include:
The Bank costs were well managed at Kshs 13.3 billion reflecting 6% increase year on year below inflation.
In order to reposition the bank for the future, and in line with its new strategy, the bank invested significantly towards simplifying its structures, the brand transition project and new non-branch service channels, driven by changing customer behaviour. Adjusted for these investments, total costs dropped by 4% in the review period, outperforming inflation. The savings derived from these initiatives were used to fund sustainable investments especially in automation and digitization.
Impairment increased by 21% compared to similar period last year largely attributable to adoption of IFRS 9 and also a few client names. The increase resulting from implementation of IFRS 9 was due to the fact that the bank applied a prudent approach to adequate loan loss provisioning in prior periods. In the period, the bank registered significant improvement in upstaging the levels of underwriting standards as well as internal efficiencies on the collections and recoveries fronts.
The Bank’s average loan loss ratio stood at 2.1% and Net NPL stood at 2.4% while the statutory provisions remained nil; an indication of adequate provisioning way above the regulatory guidance. The bank has adequate buffers to cushion itself from the provisions impact.
Capital & Liquidity
Barclays Bank’s capital and liquidity ratios remain strong with sufficient headroom above the regulatory requirement; total capital adequacy ratio at 17.1% and liquidity reserve position at 39.9% against the regulatory limits of 14.5% and 20% respectively.
“In conclusion, Barclays Kenya is well positioned for the future as underpinned by our new 5-year strategy which is focused on driving Growth, Transformation and Returns. We would like to thank all our stakeholders for the support in in the year and remain optimistic in the remaining part of 2018.’ Barclays Bank of Kenya Managing Director, Jeremy Awori, said.