KCB Group Q3 Net Profit Drops 43% to Ksh 10.9 Billion

KCB Ranked Top Bank In East Africa

KCB Group has posted a 43% drop in net profit for the nine months that ended on 30th September 2020 to KSh 10.9 billion attributed to high loan provisions.

The latest results are a decline from KSh19.2 billion posted in the same period the year before.

KCB Group’s loan provisions surged fro. KSh5.8 billion to KSh 20 billion due to the Covid-19 impact.

“This has been a challenging period for the business, staff, customers, and the economy. Our focus has been on keeping our staff and customers safe while at the same time giving business support to the communities we operate in as well as our customers,” said KCB Group CEO Joshua Oigara.

According to Genghis Capital, KCB Group’s digital strategy will be the key growth driver in the post-pandemic environment as key in driving efficiency levels (operating expenses before provisions down 0.2% y/y) which has been sustained below the 50.0% level for the past year (CTI at 46.3% from 48.8% in 3Q19).

However, “The operating environment has deteriorated substantially due to the unraveling pandemic and while business activity has improved from 2Q20, there is still high uncertainty on provisioning levels and post-restructuring performance of restructured loans (KES 105Bn restructured),” Genghis Capital notes in its KCB Group Plc (NSE: KCB) 3Q20 Earnings Note.