"Kenya: KCB profit falls to $178.5 million on increased bad loans provision"

" \n KCB Group\u2019s net profit declined 22 per cent to Sh19.6 billion ($178.5 million) in the year ended December on the back of increased provisions for coronavirus-related defaults. \n \n\n \n The Nairobi Securities Exchange-listed firm had reported net earnings of Sh25.1 billion ($228.6 million) the year before. \n \n\n \n The reduced profit came as loan loss provisions tripled to Sh27.5 billion ($251 million) from Sh8.8 billion ($80 million), with the lender responding to non-performing loans (bad loans) rising to Sh96.6 billion ($880 million) from Sh63.4 billion ($578 million). \n \n\n \n The performance shows that the bank\u2019s profitability had improved substantially in the last quarter, reversing a downward trend seen in the nine months ended September when its profit fell 43.1 per cent to Sh10.8 billion. \n \n\n \n KCB declared a dividend of Sh1 per share or an aggregate of Sh3.2 billion, representing a 71.4 per cent drop from its normal payout of Sh3.5 per share or a total of Sh11.2 billion in the pre-pandemic years. \n \n\n \n The dividend will be paid to shareholders on the register as of April 26, 2021. \n \n\n \n \u201cThe board has proposed a final dividend of Sh1 per share. This proposal seeks to balance income distribution to shareholders while protecting capital for the bank,\u201d the lender said in a statement. \n \n\n \n The Central Bank of Kenya had told banks that they will only pay dividends after ensuring that they have enough capital to ride out the economic fallout from the pandemic. \n \n\n \n Similar restrictions have been imposed by regulators in other markets including the United Kingdom. \n \n\n \n KCB\u2019s loan book rose 10.2 per cent to Sh595.2 billion ($5.4 billion) in the review period, helping to raise its total asset base to Sh987.8 billion ($8.9 billion) and closer to its short-term target of Sh1 trillion. \n \n\n \n The bank\u2019s total income increased 14 pe rcent to Sh96.3 billion, mainly driven by a 65 percent jump in interest earned on government debt securities to Sh23.1 billion. \n \n\n \n KCB says it is optimistic that the nascent signs of economic recovery seen from the end of 2020 can be sustained. \n \n\n \n \u201cThe pandemic significantly affected our business across the markets we operate in, with most of them going into some degree of lockdown,\u201d the bank\u2019s chief executive Joshua Oigara said in a statement. \n "

"Kenya: KCB profit falls to $178.5 million on increased bad loans provision"

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