Mobile channels push KCB Group Half Year profit to Sh12.7b

Joshua Oigara, KCB Group CEO and MD said investment in technology generated positive return and further helped drive efficiency and deepen access to affordable financial services.

An increase in mobile channel activity for the first half of 2019 coupled with the growth of the loan book has seen KCB Group post a profit of Sh12.7 billion, a 5 percent growth compared to the Sh12.1 billion the bank declared same time last year.

Channel transactions done outside the branch increased to 96 percent of total transactions, up from 87 percent in 2018 driven by mobile channel.

“We had a strong second quarter and witnessed continued growth across our businesses segments. The investment in technology generated positive return and further helped drive efficiency and deepen access to affordable financial services in all markets,” said Joshua Oigara, Group CEO and MD.

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Fees and commissions increased by 31 percent to Sh8.9 billion as revenues from digital channels in particular KCB M-PESA grew significantly powered by the new platform launched late last year.

The value of loans disbursed via KCB M-PESA during the period of review increased from Sh14.9 billion in HY 1 2018 to Sh66.7 billion in HY1 2019.

READ: 93 percent of mobile loans in Kenya are issued by banks: Study

“Looking forward, we expect to build momentum in the second half of the year in line with increased economic activity across sectors, which should deliver topline growth and assist cushion asset quality,” said KCB Group Chairman Andrew Kairu.

The Group’s balance sheet increased by 12 percent to Sh746.5 billion, with deposits up 7 percent to Sh563.2 billion supported by continued strong growth in personal and transaction accounts while the loan book surged 14 percent to Sh478.7 billion.

On key strategic business initiatives for the second half of the year, KCB plans to finalize the transfer of part of the assets and liabilities of Imperial Bank In Receivership Limited as well as complete the takeover bid for National Bank of Kenya by the end of the current quarter.

Following the results, the Board of Directors approved a payment of an interim dividend of Sh1.00 per share. Shareholders will be paid the dividend in November 2019.