KCB Group shareholders have approved a total dividend payout of Ksh9.64 billion ($83.1 million) following a 74 percent rise in profit for the financial year ended December 31, 2022.
The final dividend of Ksh2 ($0.01) per share will be paid by July 7.
Shareholders will have received a total of Ksh3 ($0.02) per share this year after an interim dividend of Ksh1 was paid out in January.
The payout was approved at the Group’s 51st AGM that was conducted via electronic means last week.
Chair Andrew Kairu said in spite of the challenging business environment last year, the KCB continued to generate returns for its shareholders.
“The group made significant progress with our strategic priorities and delivered strong business and financial returns,” said Mr Kairu. “This performance affirms the robustness of all other important aspects of our business, including customer excellence, employee commitment, sustainability, and digital solutions.”
The Group’s net profit for 2021 was Ksh34.2 billion ($294.82 million) up from Ksh19.6 billion ($168.96 million) in 2020, buoyed by increased revenue from trading operations and more than 50 percent reduction in loan loss provisions.
Regional subsidiaries’ contributions to the bottom line increased to 13.7 percent from 13.6 percent over the year.
The contributions included Tanzania ($6.33 million), South Sudan ($8.03 million), Uganda ($2.36 million), Rwanda ($9.56 million) and Burundi ($4.54 million).
“Moving forward, we are determined to sustain this momentum targeting to maintain return on average equity above 20 percent as our operating environment continues to improve,” Mr Kairu said. The Group has 193,274 shareholders, of whom 89 percent are local individual and institutional investors, and 11 percent are foreign investors.
Last year, the total shareholder return was 27 percent, significantly above the average inflation rate.
In the first quarter of this year, the group posted a 54 percent growth in net profit to Ksh9.78 billion ($84.31 million), from Ksh6.37 billion ($54.91 million) in the same period last year, largely supported by growth in both interest and non-interest income and a reduction in loan loss provisions.
“We are optimistic of improved business growth in the remaining part of the year as economic fundamentals improve in the East African economy, despite global threats and other local developments,” said Mr Kairu. “Our priority is to harness economic drivers to accelerate the pace of recovery and growth.”
The Group’s unaudited financial statements show a 26 percent surge in total revenues to Ksh29.03 billion ($250.25 million) from Ksh23.04 billion ($198.62 million) with total costs going up by 16.8 percent to Ksh12.9 billion ($111.2 million) from Ksh11.1 billion ($95.68 million) in the same period.
Net interest income earned on loans and government securities grew by 18 percent to Ksh19.7 billion ($169.82 million) while non-funded income (NFI) or non-interest income grew by 47.2
The Group’s balance sheet expanded by 19.3 percent to Ksh1.2 trillion ($10.34 billion), following the acquisition and consolidation of Banque Populaire du Rwanda (BPR).
Last year (2021) KCB acquired 62.06 percent stake in BPR from the British financial services conglomerate Atlas Mara Ltd (ATMA) and later increased the stake to 76.67 percent by acquiring additional 14.61 percent of the shares from the minority shareholders.
The transaction increased KCB’s assets by 15.4 percent to Ksh1.13 trillion ($9.74 billion).
KCB has operations in Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan and a representative office in Ethiopia
It is also keen on entering the Democratic Republic of Congo (DRC) as part of its Pan-African expansion bid.