National Bank of Kenya (NBK) has issued a profit warning, citing ‘increased loan impairment charges beyond initial projections’ and the cost of restructuring.
The listed banker now joins Kenya Power, Kenya Re, Unga Group, Crown Paints, UAP, Britam, Sameer Africa, Bamburi Cement, Mumias Sugar and Sanlam in the list of firms that have issued warnings due to a difficulty in the operating environment.
“NBK earnings for the period ended December 31 will be at least 25% lower due to… increased loan impairment charges beyond initial projections due to a revision of the valuation and values recoverable from the non-performing loan portfolio,” said Company Secretary Habil Waswani.
“During the year the group incurred a one-off restructuring cost (voluntary early retirement programme) as part of the wider business alignment. The full benefits will be realised in 2019,” he said.
In 2017, the bank posted a profit before tax of Ksh 182 million for the period ending 31 December 2016 compared to 2015 which stood at a loss of Ksh 1.6 billion attributed to better management of cost of funds and increased volumes from clients.