KCB Group achieved a 65% increase in net profit to Ksh61.8 billion ($479.06 million) for 2024, leading to resumed dividend payments. Growth came from regional subsidiaries and improved financial management. Notable performance from most subsidiaries and a strong rebound in KCB Kenya were key contributors, signaling optimism for future market conditions.
In a positive turn, KCB Group has announced a remarkable 65 percent increase in net profit, amounting to Ksh61.8 billion ($479.06 million) for the year ending December 31. This surge can be attributed to the robust growth of revenues from regional subsidiaries and increased earnings from loans, government securities, foreign exchange trading, and additional banking transactions. Consequently, the group has reintroduced dividend payments, paused in 2023 to bolster capital reserves.
The financial results indicate that KCB Group’s subsidiaries, excluding KCB Kenya, accounted for 30.3 percent of the overall profits, with most regional units, except those in Uganda and Rwanda, demonstrating double-digit profit growth. “The strong performance illustrates our resolve over the past three years to build an organization for the future that is anchored on delivering value for our customers, shareholders and all stakeholders,” stated Paul Russo, the chief executive of KCB Group, during a recent investor briefing in Nairobi.
KCB Kenya experienced the highest profit growth at 77 percent, while the Democratic Republic of Congo’s Trust Merchant Bank reported a profit increase of 28 percent during the same period. The overall net profit from subsidiaries outside KCB Kenya rose by 42 percent to Ksh19.6 billion ($151.03 million), showcasing the strong performance of regional units despite a decline in earnings from Rwandan and Ugandan operations.
In light of this improved financial performance, the board of directors has recommended a final dividend payment of Ksh1.5 ($0.01) per share for shareholder approval, bringing the total annual payout to Ksh3 ($0.02) per share, amounting to Ksh9.6 billion ($74.41 million) following an interim dividend made in September 2024. This marks a significant turnaround given that KCB Group had not issued dividends in 2023 for the first time in 21 years.
Mr. Russo attributes the previous decline in profitability to the necessary restructuring initiatives he instituted since his appointment as CEO in May 2022. The group’s total income grew by 24 percent, reaching Ksh204.9 billion ($1.58 billion), largely driven by increases in interest income from various financial assets and improved operational efficiencies across diverse business lines.
Net interest income increased by 28 percent to Ksh137.34 billion ($1.06 billion). Non-funded income also rose by 16.61 percent, accounting for 33 percent of overall revenues. KCB Group operates across multiple countries, including Kenya, Uganda, Tanzania, Rwanda, Burundi, South Sudan, and the Democratic Republic of Congo, and continues to navigate the challenges of the regional market while maintaining financial stability.
In summary, KCB Group has achieved a noteworthy 65 percent increase in net profit, leading to the resumption of dividend payments. This growth is primarily driven by strong performance across regional subsidiaries and a successful financial restructuring. The overall economic outlook appears positive, with expectations for continued recovery in key service sectors and credit growth, reinforcing KCB’s commitment to long-term sustainability and value creation for stakeholders.
Original Source: www.zawya.com
