KCB Group’s net profit surged by 65% to Ksh61.8 billion in 2024, driven by regional investments and enhanced revenue streams. The bank will resume dividend payouts after a suspension in 2023, with subsidiaries contributing significant profits, despite minor declines in Uganda and Rwanda. The outlook remains optimistic as KCB anticipates further growth amid improving economic conditions.
KCB Group reported a remarkable 65 percent increase in net profit for the fiscal year ending December 31, rising to Ksh61.8 billion ($479.06 million). This surge is attributed to the robust growth in revenues from regional investments, enhanced income from customer loans, government securities, foreign exchange trading, and banking operations. Consequently, the group announced the resumption of dividend payouts, which had been previously suspended in 2023 to strengthen capital buffers.
The group’s audited financial results reveal that the contribution of regional subsidiaries, excluding KCB Kenya, constituted 30.3 percent of the total profit. Notably, all regional units, except those in Uganda and Rwanda, registered double-digit profit growth during this period. Paul Russo, KCB Group’s Chief Executive Officer, highlighted this strong performance as a reflection of the bank’s commitment to creating sustainable value for its customers, shareholders, and stakeholders.
KCB’s net earnings grew from Ksh37.5 billion ($290.69 million) in the previous year, marking a significant increase fueled by its Kenyan operations, which outperformed other regional branches. Furthermore, Trust Merchant Bank in the Democratic Republic of Congo excelled with a 28 percent profit growth, while profits from Burundi and Tanzania rose by 23 percent and 20 percent, respectively. However, profits from the Rwandan and Ugandan branches saw slight declines of 3 percent and 1 percent, respectively.
In light of its improved financial performance, KCB Group’s board has proposed a final dividend of Ksh1.5 ($0.01) per share, subject to shareholder approval, totaling Ksh9.6 billion ($74.41 million) for the full fiscal year.
KCB, recognized as the largest lender in the region with assets totaling Ksh2 trillion ($15.5 billion), faced four consecutive quarters of declining profits in 2023 which led to the first cessation of dividend payments in 21 years. Mr. Russo described the prior year’s profit downturn as part of a necessary restructuring effort to maintain the bank’s future growth and stability.
Moreover, the group anticipates a positive economic environment across its markets, with optimism about growth in credit to the private sector and recovery in exports. The total income of KCB Group, driven primarily by increasing interest income from loans and improved efficiencies, rose by 24 percent to Ksh204.9 billion ($1.58 billion). Net interest income and non-funded income also recorded significant growth, reflecting robust business strategies and operational advancements across its various establishments.
In summary, KCB Group’s financial performance for 2024 demonstrates strong growth, with a 65 percent increase in net profit attributed to substantial revenue from regional subsidiaries and efficient banking operations. The board’s decision to reinstate dividend payouts underscores the bank’s recovery and commitment to its stakeholders. The outlook appears optimistic as KCB positions itself for further growth amidst predicted economic improvements in the upcoming year.
Original Source: www.zawya.com
