NCBA Profits After Tax Hit Ksh14.6 Billion


NCBA Group PLC has posted a profit after tax of Ksh14.6 billion in its Q3 results ending September 30th 2023, which is a 14.4 per cent increase compared to Ksh12.8 billion reported during a similar period last year.

Key Highlights

§  Customer deposits closed at Ksh548 billion, 19 per cent up year on year

§  Assets grew to Ksh679 billion, 14 per cent up year on year

§  NCBA Group disbursed Ksh695 billion in digital loans, 33 per cent increase year on year

§  Operating income of Ksh46.7 billion, 2 per cent up year on year

§  Provision for credit losses was Ksh6.1 billion, 27 per cent down year on year

§  Profit before tax of Ksh18.6 billion, 2 per cent up year on year

§  Profit after tax of Ksh14.6 billion, 14 per cent up year on year

The growth trajectory for the Group remained solid compared to 2022 driven by positive operating income and a decline in loan impairment charges by 27 per cent. The Group’s operating expenses closed at 19 per cent up year on year on the back of inflationary pressures and continued investment in the current five-year strategy.

While releasing the quarter three financial results, NCBA Group Managing Director, John Gachora commented, “These robust financial results are attributable to laser focus on our key strategic priorities to support our customers and grow shareholder returns.”

“Our Q3 performance continued to be buoyed by the significant contributions of the regional subsidiaries (Tanzania, Rwanda and Uganda) which collectively delivered a profit before tax of Ksh2.3 billion (a notable improvement from the loss of Ksh312 million posted in Q3 2022)” said Gachora. These regional outcomes were a result of the Group’s turnaround strategy in Tanzania and accelerated growth in Uganda and Rwanda.

In line with the commitment of being accessible to customers, NCBA`s branch expansion activities resulted to additional locations in Muranga, Kenol, Chwele, Migori, Kahawa Sukari, Eastleigh, Wote and Ruaka, bringing the Group`s branch network to 107.

NCBA remained a market leader in asset finance with a 34% market share driven by improved focus on corporate customers, innovative solutions and stronger dealer partnerships. As part of this focus, NCBA was the title sponsor of the NCBA-KMI MotorShow, which attracted close to 10,000 potential vehicle owners.

NCBA continued to embrace digital transformation for it`s over 60 million customers across Africa with digital lending reaching KES 695 billion for the period. This was achieved through enhanced online plus mobile platforms and streamlined digital processes.

NCBA launched its Sustainability platform “Change the Story” and unveiled a set of 15 Bold Sustainability Commitments. This was a critical milestone as the Group strives to catalyze action towards a Greener and More Sustainable Future.

As the quarter closed, NCBA announced its intention to acquire 100% of AIG Kenya Insurance Company Limited. The announcement came after authorization from the Group’s Board of Directors commencing discussions with AIG Group to acquire its entire shareholding in AIG Kenya Insurance Company Limited (subject to regulatory approvals).

Speaking on the rationale for the transaction, NCBA Group Managing Director John Gachora said, “Insurance is increasingly becoming a basic financial need for the type of customer that NCBA serves. We believe that by bringing together NCBA’s physical and digital distribution platforms and AIG Kenya’s insurance capabilities we will accelerate towards our ambition to become a universal bank that addresses a full set of our customers’ financial needs”.

On future prospects, Gachora commented, “Overall, we remain optimistic on full year performance prospects. The risks to this outlook off course are many but largely stem from an even more uncertain external environment notably, the expectation that interest rates will remain “higher for longer” in order to bring down inflation to within target.

Even then, given the fact that concerns around Kenya’s debt sustainability have been a significant drain on growth prospects, the recently announced IMF staff level agreement on the sixth review of the extended credit facility that will see the country receive an immediate release of USD 638 Million should undoubtedly provide further impetus to output.

We will continue with our unwavering commitment to our customers, employees and the communities we serve and are confident in our ability to continue delivering sustainable growth and creating value for all our stakeholders.”

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