Diamond Trust Bank Kenya reported a 28 percent decline in its net profit after tax to Kshs 4.3 billion in the third quarter ended on 30th September.
The drop was largely driven by a 232 percent increase in loan loss provisions which moved to KSh2.9 billion from KSh870 million in the third quarter of 2019.
The lender’s loan book expanded to KSh205.6 billion, a 7% increase from KSh192 billion in the same period in 2019.
Customer deposits grew by 1.8% to KSh288 billion.
Total assets increased by 3% to KSh394.0 billion from KSh382.5 billion in September 2019 while total liabilities grew by 2% to KSh324.9 billion from KSh317.8 billion.
“The bank is currently trading at a Price-to-Book multiple of 0.3x which could be a pointer to the historically low dividend yield over recent years (currently at 4.3%) and the low ROE which has slumped below the double-digit level currently at 8.5%,” Genghis Capital Diamond Trust Bank of Kenya (NSE: DTK) 3Q20 Earnings Note.
Sterling Capital in term of the banks’ FY 2020 outlook, they expect the bank to continue focusing on NFI growth as well as increasing its holding in government securities to drive business growth to full potential.
“We further anticipate the bank to implement additional cost management strategies to contain operating expenses.”