Khusoko – East African Markets
    Facebook Twitter Instagram
    Khusoko – East African MarketsKhusoko – East African Markets
    • NEWS
    • ECONOMY
      • BANKING & FINANCE
      • COMPANY
      • MARKETS
    • INDUSTRY
      • AGRICULTURE & ENVIRONMENT
      • HEALTH & WELLNESS
      • PROPERTY
        • RETAIL
      • TECHNOLOGY
        • ELECTRONICS
    • ENTREPRENEURSHIP
      • ENTREPRENEURS
      • PEOPLE
      • PERSONAL FINANCE
    • SPORTS
    • COMMENTARY
    • ARTS & CULTURE
      • BOOKS
      • ENTERTAINMENT
      • FAMILY & RELATIONSHIPS
      • FASHION & STYLE
      • FOOD & DRINK
      • TRAVEL & LEISURE
    Khusoko – East African Markets
    BANKING & FINANCE

    Kenyan Listed Banks Witness Increase in Core EPS, Decline in Deposits in Q3’2018

    KhusokoBy Khusoko2018-12-031 Comment3 Mins Read

    Kenyan listed banks recorded a 16.2% average increase in Core Earnings Per Share (EPS), compared to a decline of 9.3% in Q3’2017.
    According to Cytonn Investments November 2018 highlights, all the banks recorded positive growth except for NIC Group and HF group that recorded declines in core EPS.
    “NIC recorded a decline of 3.3%, and HF recording a decline to a loss per share of Kshs 0.9 from core earnings per share of Kshs 0.5 in Q3’2017. National Bank recorded the highest growth of 303.2% y/y,” Cytonn Notes.
    The Central Bank of Kenya during its MPC meeting in November reiterated that the sector remained stable and resilient.
    “Average commercial banks’ liquidity and capital adequacy ratios increased to 48.9 percent and 18.4 percent, respectively, in October 2018. The ratio of gross non-performing loans (NPLs) to gross loans fell to 12.3 percent in October 2018 from 12.7 percent in August, largely due to declines in NPLs in the trade, and personal and household sectors. The declines were mainly due to sustained recovery efforts by banks.”
    Q3’2018 Highlights
    The sector recorded weaker deposit growth, which came in at 7.4%, slower than the 13.8% growth recorded in Q3’2017. Despite the slower deposit growth, interest expenses increased by 12.5%, indicating banks have been mobilizing expensive deposits.
    Average loan growth was anemic coming in at 4.2%, which was lower than 6.1% recorded in Q3’2017, indicating that there was an even slower credit extension in the economy, due to sustained effects of the interest rate cap.
    Government securities, on the other hand, recorded a growth of 14.6% y/y, which was faster compared to the loans, and faster than 10.3% recorded in Q3’2017.
    “This indicates that banks’ continued preference towards investing in government securities, which offer better risk-adjusted returns.”
    Interest income increased by 6.1%, compared to a decline of 5.8% recorded in Q3’2017, as banks adapted to the interest rate cap regime, with increased allocations in government securities. The Net Interest Income (NII) thus grew by 3.8% compared to a decline of 7.3% in Q3’2017.
    The average Net Interest Margin in the banking sector currently stands at 8.0%, down from the 8.5% recorded in H1’2017, despite the Net Interest Income by increasing 3.8% y/y. The decline was mainly due to the faster 14.6% increase in allocation to relatively lower yielding government securities.
    Non-funded Income grew by 5.9% y/y, slower than 10.9% recorded in Q3’2017. The growth in NFI was weighed down as total fee and commission growth was flat, growing by 0.6%, slower than the 10.5% growth recorded in Q3’2017. The growth in fee and commission income continued to be subdued by the slow loan growth.
    Source: Cytonn Investments

    Cytonn Investments Kenyan listed banks
    Khusoko

    Multimedia platform providing analysis of business & financial news in East Africa.

    Related Posts

    How to Choose the Right Forex Trading App for Your Needs

    2023-06-02

    Madaraka Day: Kenya Launches The Hustler Group Loan

    2023-06-01

    CAK Approves Hope Advancement’s 51pct Acquisition of Smep Microfinance Bank

    2023-05-29

    Leave A Reply Cancel Reply

    Our Language is Flirty
    https://www.facebook.com/flirtynailsparlour/
    MORE TOP STORIES
    • Faith Kipyegon Smashes 1500m World Record in Florence in 3:49.11
    • John Ngumi Steps Down From Kenya Airways Board
    • Court Orders Winding Up of Debt Ridden Tuskys Supermarket
    • How to Choose the Right Forex Trading App for Your Needs
    • Xiaomi Moves Up on BCG’s Most Innovative List on Increased Investment
    • Facebook
    • Twitter
    • LinkedIn
    Facebook Twitter LinkedIn
    • ABOUT US – KHUSOKO
    • PRIVACY POLICY
    • KHUSOKO STANDARDS GUIDE
    © 2023 Khusoko. All Rights Reserved.

    Type above and press Enter to search. Press Esc to cancel.