Equity posts 3pc drop in net profit

Monday October 30 2017

Equity Bank chief executive James Mwangi. File photo | nmg

Equity Bank chief executive James Mwangi. File photo | nmg 

By KEVIN MWANZA
More by this Author

Equity Bank is looking to transactions income and regional subsidiaries to grow its earnings as the cap on cost of loans and a charged political environment cut its interest income and shaved its profit for the nine months to September.

The largest bank by customer base Monday reported a three per cent drop to Sh14.6 billion in third quarter after tax profit as its interest income fell 11 per cent to Sh35.4 billion.

Transactions income, which increased 28 per cent to Sh21.3 billion, cushioned the lender’s bottom line.

The non-funded income included earnings from foreign exchange trading, mobile banking and diaspora remittances.

“The engines of the private sector are closing off,” said Equity Group CEO James Mwangi said about the slowing credit growth in Kenya. “The wind has been taken out of the sail by these temporary headwinds.”

Equity’s investment in government securities jumped 37 per cent from Sh93.1 billion to Sh127.7 billion.

Mr Mwangi attributed the increased investment in fixed income to higher returns than on new loans.

“This is not lazy banking because the return on government securities is higher,” he said.

“We are not able to lend to the micro borrowers whose default rate is as high as 80 per cent.”

The Equity CEO said the bank is looking to grow its share of diaspora remittances to half of the money sent to the country every month.

It handled $48 million of diaspora remittances in September alone, up from $12 million in July. “We are looking to handle $60-$70 million of the flows coming to the country.

“That will effectively make us a big player in the foreign exchange market,”

All the regional subsidiaries, apart from Democratic Republic of Congo (DRC), posted double digit growth in profitability.

Mr Mwangi attributed the challenging political environment in DRC as the reason behind the dip.

“Equity Bank managed to shield itself from the headwinds and that was something impressive. They adopted very fast to the environment,” said Ewart Salins, executive director at Kestrel Capital.

Parliament in September last year capped the interest rate payable on loans to a maximum of four percentage points above the Central Bank Rate.


<var id="SFyvZPh"></var>
<cite id="SFyvZPh"></cite>
<cite id="SFyvZPh"><span id="SFyvZPh"><var id="SFyvZPh"></var></span></cite><cite id="SFyvZPh"><span id="SFyvZPh"><var id="SFyvZPh"></var></span></cite>
<ins id="SFyvZPh"><span id="SFyvZPh"><cite id="SFyvZPh"></cite></span></ins>
<var id="SFyvZPh"><strike id="SFyvZPh"><menuitem id="SFyvZPh"></menuitem></strike></var>
<var id="SFyvZPh"><span id="SFyvZPh"></span></var><ins id="SFyvZPh"><span id="SFyvZPh"><cite id="SFyvZPh"></cite></span></ins><var id="SFyvZPh"><video id="SFyvZPh"><menuitem id="SFyvZPh"></menuitem></video></var>
<cite id="SFyvZPh"></cite>
<cite id="SFyvZPh"></cite>
<cite id="SFyvZPh"></cite>
<ins id="SFyvZPh"></ins><ins id="SFyvZPh"><span id="SFyvZPh"><cite id="SFyvZPh"></cite></span></ins><ins id="SFyvZPh"><span id="SFyvZPh"><cite id="SFyvZPh"></cite></span></ins>
<var id="SFyvZPh"><span id="SFyvZPh"></span></var><cite id="SFyvZPh"><video id="SFyvZPh"></video></cite>
<ins id="SFyvZPh"></ins>
<cite id="SFyvZPh"></cite>
<cite id="SFyvZPh"></cite><cite id="SFyvZPh"><span id="SFyvZPh"></span></cite><cite id="SFyvZPh"></cite>
<cite id="SFyvZPh"></cite><cite id="SFyvZPh"><span id="SFyvZPh"></span></cite><cite id="SFyvZPh"><span id="SFyvZPh"></span></cite>
<ins id="SFyvZPh"></ins>
<var id="SFyvZPh"><video id="SFyvZPh"><thead id="SFyvZPh"></thead></video></var>
<cite id="SFyvZPh"></cite>
  • 5414891071 2018-01-21
  • 392961070 2018-01-21
  • 9593791069 2018-01-21
  • 9326521068 2018-01-21
  • 8204451067 2018-01-21
  • 3174701066 2018-01-21
  • 1649671065 2018-01-21
  • 5257251064 2018-01-21
  • 5865741063 2018-01-21
  • 6353551062 2018-01-21
  • 2642131061 2018-01-20
  • 8004871060 2018-01-20
  • 284371059 2018-01-20
  • 2901131058 2018-01-20
  • 1957611057 2018-01-20
  • 879421056 2018-01-20
  • 8217961055 2018-01-20
  • 2423161054 2018-01-19
  • 9005611053 2018-01-19
  • 8099421052 2018-01-19