Absa Bank Kenya has reported a profit after tax of Kshs.10.7 billion for the half year ended 30 June 2024. This is a 29% rise as compared to Ksh. 8.3 Billion reported in a similar period last year.
The rise in profitability was on the back of a 20% rise in the net interest income to Ksh. 23 Billion and an 8% increase in the non funded income to Ksh. 8.8 Billion. Raising revenues by 16% to Ksh. 31.8 Billion.
Operating costs grew by 12% to 11.4 Billion and this was mostly driven a rise in staff costs to Ksh. 6.1 Billion. The bank’s loan loss provision was retained at Ksh. 5.2 Billion similar to last year. This is in line with bank’s principles of prudence in risk management given balance sheet growth and tough operating environment.
Loans and advances closed at Kshs.316.3 billion, with the Bank booking Kshs. 64 billion in new gross lending to critical sectors of the economy. While customer deposits increased by 6% to Kshs. 353.3 billion, reflecting the sustained confidence they have in Absa as their primary financial partner.
The Bank’s capital and liquidity ratios remain strong with sufficient headroom above the regulatory requirement. The Bank’s total capital adequacy ratio closed the quarter at 18.6% and liquidity reserve position at 35.2% against the regulatory limits of 14.5% and 20%, respectively.
In response to the current economic realities, the Bank took deliberate actions to support its customers, restructuring approximately Kshs. 1.4 billion in loans for retail consumers impacted by tough economic times. In addition, the Bank enhanced the provision of non-financial skills towards supporting the growth ambitions of MSMEs and Women in Business, impacting more than 14,000 entrepreneurs in the period.
Absa Bank Kenya PLC Managing Director and CEO, Abdi Mohamed, “This commendable outcome, realized amidst a challenging macro-economic environment, underscores the efficacy of the Bank’s growth strategy and its unwavering dedication to providing relevant financial solutions that address the diverse needs of individuals, enterprises, and communities because we want to continue being a critical enabler to their growth stories,” Mr. Mohamed said.
The Absa Bank Board recommended an interim dividend of Ksh. 0.20 per ordinary share.