Equity Bank Group Q1 net profit up 25.1 per cent to Sh15.3bn

By Victor MUJIDU

Equity Group has recorded a 25.1 per cent increase in net profit for the first three months to March translating to a Ksh3 billion increase from Ksh12.3 billion to 15.3 billion in a similar period last year.

The increase in net profit is as a result of higher income by the bank that record in both interest and non-funded income.

The group’s interest rate, hit Ksh27.3 billion from Ksh20.7 billion of a similar period in a previous year.

Dr. James Mwangi the Managing Director and CEO of Equity Group said that East Africa is among the fastest growing region globally, contributing almost 63 per cent of the regional banking subsidiaries before tax.

“The regional diversification of banking business has worked very well for us and as we can see profit before tax, the regional subsidiaries are contributing 63 per cent of the entire profit which stands at Ksh20.4 billion profit before tax with a return on average equity of 27.6 per cent, cementing the Group’s position as the regional banking leader,” the CEO said.

The Q1 2024 financial report unveiled that the total assets have grown to Ksh1.822 trillion up from Ksh428.1 billion as shareholders’ funds grew to Ksh218.1 billion up from Ksh72.1 billion.

Gross trade finance revenue grew by 90 per cent to Ksh11 billion from Ksh5.8 billion driven by a 106 per cent growth of trade finance related lending and 26 per cent growth of trade finance guarantees and off-balance sheet items.

“The increase in total expenditures to Ksh128.2 billion from Ksh84.5 billion was primarily caused by a 139 per cent increase in loan loss provision, which went from Ksh13.7 billion to Ksh32.8 billion in order to fortify asset quality buffers,” he said.

Due to significant inflation and the depreciation of the Kenyan shilling, other operational expenses and staff costs increased by 39 per cent and 28 per cent, respectively.

Gross balance sheet grew by 26 per cent to Ksh1.821 trillion up from Ksh1.447 trillion driven by 29 per cent growth in customer deposits to Ksh1.358 trillion from Ksh1.052 trillion.

Net loans increased by 26 per cent to Ksh887.4 billion from Ksh706.6 billion as a result of funding deployment; government securities holdings increased by 27 per cent to Ksh500.5 billion from Kshs.394 billion, while cash and cash equivalents increased by 25 per cent to Ksh290.1 billion from Ksh232.4 billion.