HFCB Group PLC and I&M Group PLC posted higher half-year earnings .[File, Courtesy]
Listed lenders I&M Group PLC and HFCB Group PLC posted higher half-year earnings on Thursday, joining rivals in delivering results that have provided a rare bright spot against the backdrop of a tight domestic economy.
I&M Group net profit after tax grew by 20.4 per cent to hit Sh9.30 billion for the six months that ended on June 30, up from Sh7.73 billion in the same period last year.
The growth in earnings was driven by a 23 per cent surge in total operating income to Sh33.7 billion, supported by a 22.5 per cent rise in net interest income.
The lender's net interest income climbed to Sh25.04 billion, a 22.5 per cent increase supported by a 15 per cent expansion in its loan book to hit Sh334 billion, according to the company's financial statements.
The Group's total assets further grew by 27 per cent to Sh746 billion, while customer deposits increased by 18 per cent to reach Sh505 billion. Asset quality improved with gross non-performing loans (NPL) declining by 12 per cent to Sh30.1 billion, while the net NPL ratio improved to 2.3 per cent from 4.1 per cent a year earlier.
"The strong growth in operating income, combined with the increasing contribution from our regional subsidiaries, reflects a disciplined execution of our diversification strategy," said I&M Group Regional CEO Kihara Maina in a statement.
The regional diversification strategy proved successful, with subsidiaries outside Kenya accounting for 33 per cent of group profit before tax, up from 25 per cent in the prior year.