NCBA GROUP PLC REPORTS PROFIT AFTER TAX GROWTH OF 20.3% TO KSH. 9.3B

NCBA Group PLC reports Profit After Tax growth of 20.3% to Ksh. 9.3 billion

By Wangechi Wahome

NCBA Group PLC has posted a profit after

tax of KES 9.3 billion in its H1

results ending June 30th 2023, which is

a 20.3 per cent increase compared to KES

7.8 billion reported during a similar

period last year.

The Group registered a profit before tax

of KES 12.4 billion representing 11 per

cent growth up from KES 11.2 billion in

H1 2022.

Key Highlights

§ Assets grew to KES 660 billion, 9 per

cent up year on year

§ Customer deposits closed at KES 517

billion, 10 per cent up year on year

§ NCBA Group disbursed KES 457 billion

in digital loans, 35 per cent increase

year on year

§ Operating income of KES 31.0 billion,

7 per cent up year on year

§ Provision for credit losses was KES

4.4 billion, 21 per cent down year on

year

§ Profit before tax of KES 12.4

billion, 11 per cent up year on year

§ Profit after tax of KES 9.3 billion,

20.3 per cent up year on year

The underlying growth trends in bottom

line profitability remained solid

compared to 2022 driven by an increase

in operating income and a decline in

loan impairment charges by 21 per cent.

The Group’s operating expenses were

however elevated 24.0 per cent year on

year on the back of inflationary

pressures and continued investment in

the current 5 year strategy which comes

to a close in 2024.

While releasing the half year financial

results, NCBA Group Managing Director,

John Gachora commented, “These strong

operating results are attributable to

consistent focus on our strategic

priorities.”

The Group`s strong performance enabled

the Board of Directors to recommend an

interim dividend declaration of KES 1.75

per share.

NCBA’s strategic priorities remain

unchanged as the Group heads into the

second half of the year: Become a

distinguished brand known for customer

experience, scale retail banking to

expand distribution, deepen leadership

in corporate banking and asset finance,

drive digital transformation and develop

a high performance culture.

The Group`s first half of the year

performance was significantly buoyed by

the contributions of the regional

subsidiaries (Tanzania, Rwanda and

Uganda) which collectively delivered a

profit before tax of KES 1.4 billion

(this was a notable improvement from the

loss of KES 178 million posted in H1

2022). This change in outcomes was a

result of the Group’s turnaround

strategy which led to a recalibration of

the business models in these markets

and a right-sizing of the operating

models.

Gachora noted that in Kenya there is

continued growth in the core business.

Our Retail and Corporate Banking

customer deposits have grown on the back

of building a bigger and smarter

network and offering superior customer

experience. This year, we have opened

branches in Kenol, Murang’a, Chwele,

Kahawa Sukari and Eastleigh with a plan

to open Migori, Ruaka and Wote branches

within the month. We now boast of a

network of 90 branches across 24

counties in Kenya.”

NCBA recognizes that our license to

operate is granted by the communities we

serve. Over 3,000 students from

Primary, Tertiary and University

institutions have benefited from its

2023 education, mentorship and financial

innovation sponsorship initiatives.

Through the environment and natural

resources citizenship pillar, NCBA with

a number of partners in Government,

private sector and learning institutions

has so far planted over 7 million trees

as a corporate response to

reforestation. NCBA’s investment of over

KES 50 million in the sport of Golf

through the NCBA Golf series, the Junior

Golf Foundation (JGF) and Kenya Golf

Union (KGU) sponsorships is a

significant milestone in promoting and

democratizing the sport and uplifting

the social and economic livelihood of

communities. Most recently, at the

World’s largest Junior Golf event

attended by 55 countries and held in

Pinehurst USA, Kenya was proudly

represented by 12 junior players across

various age categories courtesy of JGF,

who qualified through an NCBA sponsored

golf tour.

Gachora pointed out that while the

macro-environment remains challenging

particularly rising inflation and forex

pressure, NCBA Group`s regional

employee footprint of more than 3,000

professionals remains committed to

deliver financial solutions that help

customers navigate the changing

microeconomic environment. He further

noted that a resilient and strong

banking sector performance will support

credit availability for customers in

both the private and public sectors,

which will in turn boost investment and

tax revenue for the nation.