KCB Group reports impressive performance outside Kenya
KCB group’s earnings before tax grew by 16 percent to reach KSh34 billion. The bank’s regional operations experienced the highest growth of 64 percent in earnings before tax.
Tanzania was the best performing subsidiary. It earned KCB’s highest revenues for operations outside Kenya. Its profit before tax grew by 3989 percent to reach Ksh777 million from the previous year’s KSh19 million. KCB attributed the astronomical growth to strong demand for credit by small businesses and manufacturers. Tanzania’s good monetary environment also contributed to the growth.
The South Sudan subsidiary earned KCB group KSh664 million in profit before tax equivalent to 17 percent gain in earnings from Ksh568 million recorded in 2017. The rise was driven by good economic factors which followed the signing of the peace agreement.
Uganda’s earnings increased by 59 percent to reach KSh446 million while Burundi’s before tax profits grew by 102 percent to hit Ksh220 million.
The Rwandan segment was the only subsidiary that recorded a drop in earnings. Its profit before tax dropped by 25 percent to reach KSh424 million from KSh567 million earned in 2017.
KCB Group also announced plans to venture into the Ethiopian market in the near future. The lender to capitalize on Ethiopia’s big population (close to 100 million) which is largely unbanked. It is estimated that less than 15 per cent of Ethiopians bank accounts.
Ethiopia is going through a transformation after many years of authoritarian leadership. The country’s new Prime Minister, Abiy Ahmed, has introduced reforms in many sectors which are expected to attract foreign investors into the country.
According to KCB’s Chief Financial Officer, Lawrence Kimathi, KCB hopes to be the first Kenyan Bank to start operations in Ethiopia. “It’s a restricted market but with the talks of last week, we are hoping within the next year something will happen,” the officer was quoted by a local newspaper.
KCB plans to partner with an Ethiopian Bank or to operate a subsidiary in the nation’s capital – Addis Ababa. Ethiopia has no foreign banks operating in the country.