Bank of Kigali net profit up 12pc to $28.2 million

Tuesday February 23 2016

Bank of Kigali offices in Rwanda. PHOTO | FILE

Bank of Kigali offices in Rwanda. PHOTO | FILE | NATION MEDIA GROUP


The Bank of Kigali (BK) has recorded 11.7 per cent increase in its full-year 2015 after-tax profit buoyed by growth in net interest income.

The listed lender’s net profit rose to $28.2 million for the period ended December last year from $26.7 million in 2014.

Net interest income grew to $63.8 million representing a 17.8 per cent rise from $57.3 million a year earlier.

“The performance and growth in the balance sheet testifies the bank’s resilience in creating value for its shareholders,” noted outgoing chief executive James Gatera.

However, unlike in 2014, BK's board proposed a dividend per share of Rwf12.15 ($0.02), a dropped by 20 percentage points 40 per cent or total payout of Rwf8.2 billion ($11.3 million).

The bank will instead plough back the profit in tandem with its three-year policy to retain half of its earnings.

“Our shareholders and investors will be happy with the sustainability of the bank’s results and financial position. The bank plans to diversify its growth by venturing into other financial related services in line with the universal financial services model,” said Marc Holtzman, the chairman of the board.

BK’s loan book stood at $433 million last year from $340.3 million in 2014 while customer savings rose to $530.6 million from $473.1 million over the same period.

Forex earnings drop

Rwanda’s largest commercial bank by assets continued to cement its position with assets growth of 16.3 per cent to stand at $774.1 million.

However, volatility of the Rwandan franc against the dollar saw BK’s foreign exchange income drop by nearly a third to $7.3 million from $11.3 million in the previous year, resulting in reduction of non-interest income by 7.6 per cent to $24.1 million.

The bank expanded its agency banking network to 1,079 as at December 31, with 75 branches and 84 ATMs. Its mobile banking users increased by 48,572 to 279,208.

Increasing uptake of mobile money services in the country has seen the lender also seek a licence from the central bank to set up a telecom arm that will provide data services.

“The telecom company should be operational before the second half of this year,” said Lawson Naibo, BK’s chief operating officer.