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NBK Posts 19% Growth In Q1 2021 Profit After Tax

[PHOTO/ COURTESY]

National Bank of Kenya (NBK) has posted Ksh184 million in profit after tax for the first quarter of the year ending March 31 2021.

This represents a 19 percent growth compared to a similar period last year, attributed to increased income from loan interest and foreign exchange trading, coupled with lower loan loss provisions.

“Having received a boost in Tier 2 Capital from the KCB Group PLC, we are now well positioned to continue growing the business and supporting our customers to weather effects of the pandemic. Further, the capital injection enhances our compliance with regulatory ratios,” said NBK’s Managing Director Paul Russo.

KCB injected US$30 million (Ksh3.2 billion) bin additional debt capital to NBK in April 2021 to enhance the Bank’s capital buffers.

During the quarter, net interest income grew by five percent from the previous year to stand at Ksh1.9 billion. This was contributed by interest income which grew by 11 percent to Ksh2.7 billion due to increased volumes of loans and advances as well as sustained recoveries.

The quarter was marked by a 28 percent growth in interest paid on increased customer deposits, from transactions on the revamped digital channels.

Read: NBK Lost Ksh 9 Billion in Deposits in 3 Months After KCB Buyout

Total operating costs during the quarter remained relatively flat at Ksh2.09 billion, compared to Ksh2.11 billion over a similar period in 2020.

On the balance sheet side, total assets grew by 14 percent to Ksh114 billion, majorly from net loans and advances, which were up 20 percent to Ksh58 billion. This was also supported by increased customer deposits which grew by eight percent to Ksh99 billion due to increased flows among existing clients and new accounts in corporate and retail (including National Amanah – The bank’s Islamic Banking business) franchises of the Bank.

“We remain optimistic about prospects for this year in our efforts to turnaround the bank and deliver value for our customers. As economic activity picks up, the bank’s enhanced capital position puts us in good stead to help our customers walk the path to recovery after the slowdown due to the pandemic,” Mr Russo added.

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Written by Francis Muli

Follow me on Twitter @francismuli_. Email francis@kahawatungu.com

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