Top banks that have released their results — KCB, Co-operative Bank, Barclays, CfC Stanbic and Housing Finance — all recorded a fall in profits.
Kenyan banks posted reduced earnings in the six months to June 30, blamed on interest rate caps and reduced economic activity in the run-up to the August 8 General Election.
Top banks that have released their results — KCB, Co-operative Bank, Barclays, CfC Stanbic and Housing Finance — all recorded a fall in profits.
At 74 per cent, the mortgage firm Housing Finance posted the largest percentage decline in profit while KCB recorded a marginal decline of 0.2 per cent.
“The impact of interest rates capping and the unfavourable macroeconomic environment have resulted in a significant drop in interest-related income and an increase in interest-related expenses,” said HF Group managing director, Frank Ireri.
HF’s earnings per share also plunged, impacting shareholders’ wealth.
A review of interim financial statements show that Barclays Bank’s profit after tax for the six months to June 30 declined to Ksh3.52 billion ($35.2 million) from Ksh4.08 billion ($40.8 million) while that of CfC Stanbic Bank dropped to Ksh1.72 billion ($17.2 million) from Ksh1.94 billion ($19.4 million) in the same period last year.
Co-operative Bank’s earnings fell 10 per cent to Ksh6.6 billion ($66 million) from Ksh7.4 billion ($74 million) while KCB’s revenues fell to Ksh10.26 billion ($102.6 million) from Ksh10.28 billion ($102.8 million) in the same period last year.
HF Group’s profit fell 74 per cent to Ksh159 million ($1.59 million).
Other banks that are not listed such as Victoria Commercial Bank saw net profit plunge to Ksh 307.77 million ($3.07 million) from Ksh275.99 million ($2.75 million) while Sidian Bank posted a loss of Ksh122.79 million ($1.22 million) from a profit of Ksh158.2 million ($1.58 million).