Kenya Commercial Bank Group shareholders will take home Sh3 per share after the lender almost doubled profits for the financial year ended December 31, 2024.
The board has proposed a final dividend payout of Sh1.5 per share, subject to shareholder approval. This is in addition to an interim payout of Sh1.5 per share paid out in September 2024 bringing the total amount to Sh3 per share, amounting to a total of Sh9.6 billion for the year 2024.
The Group’s full-year profit after tax grew by 64.9 per cent to Sh61.8 billion compared to Sh37.5 billion in the previous year on strong topline expansion across all businesses.
Total revenues increased 24 per cent to Sh204.9 billion from Sh165.2 billion on higher interest income and non-funded income arising from foreign exchange trading income.
Customer deposits closed the year at Sh1.4 trillion and despite pressure attributable to the appreciation of the Kenyan Shilling against the US dollar, customer loans and advances stood at Sh990.4 billion, pushing up its balance sheet to Sh1.96 trillion.
The bank’s assets however dropped slightly from Sh2.17 trillion the previous year after the exit of National Bank that is being sold to Nigerian lender, Access Group at an estimated $100 million (Sh12.9 billion).
Group managing director, Paul Russo said the strong performance illustrates the bank’s resolve over the past three years to build an organisation for the future that is anchored on delivering value for customers, shareholders, and all stakeholders.
“We strive to be more agile by rethinking our customer-centred value propositions and leveraging Group capabilities in the markets where we operate in,” Russo said during an investor briefing in Nairobi NBK recovered from a Sh3.3 billion loss reported in 2023 to post a net profit of Sh993 million, despite assets dropping to Sh148.2 billion compared to Sh161.1 billion the previous financial year.
The Group’s diversification model continued to deliver strong benefits, with the contribution by subsidiaries (excluding KCB Bank Kenya) to the total assets standing at 34.9 per cent, while the share of profit after tax closed the year at 30.3 per cent.
The Kenyan unit of KCB grew net profit to Sh45 billion compared to Sh25.4 billion the previous year. Fees and commissions from transactions, trade finance and forex boosted non-funded income contribution of 33 per cent of the total revenues.
Operating costs grew by 11.8 per cent, to Sh92.9 billion, impacted by staff costs, technological investments, inflationary pressures and business-driven expenditure.
Provisions for expected credit losses declined by 11.0 per cent, driven by appreciation of the Kenya Shilling, successful rehabilitation of key NPL exposures and an aggressive recovery strategy.
The loan default rate rose to 19.2 per cent, translating to Sh225 billion at the end of the financial year while return on equity improved to 24.6 per cent up from 17.8 per cent per cent last year.
Total equity attributable to Group shareholders increased by 20.8 per cent from Sh227.5 billion to Sh274.9 billion, highlighting the sustained value that the Group continued to deliver for shareholders.
The Group maintained strong capital buffers with all banking subsidiaries except NBK compliant with their respective regulatory capital requirements.
Group core capital as a proportion of total risk-weighted assets stood at 17.2 per cent against the statutory minimum of 10.5 per cent while the total capital to risk-weighted assets ratio was at 19.7 per cent against a regulatory minimum of 14.5 per cent.
Group chairman, Joseph Kinyua
said that they are optimistic that
there will be a pickup in economic
activity this year across markets.
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