NCBA net profit rises 56pc to Sh21 billion

NCBA Group has posted a 55.7 percent growth in net profit for the year ended December 2023 attributed to revenue growth and a slowdown in costs.

The lender’s net profit grew to Sh21.4 billion from Sh13.7 billion the previous year.

The bank’s operating income has grown by 4.4 percent to hit Sh63.6 billion from Sh60.9 billion, supported largely by a 13 percent expansion in net interest income to Sh34.6 billion.

The higher net interest income served to offset a four percent dip in non-funded income, which was attributable to a slowdown in foreign exchange income.

NCBA’s total operating expenses remained largely unchanged at Sh38.2 billion from Sh37.9 billion in 2022 following a 30 percent slash in loan loss provisions.

The reduction in loan loss provisions was despite a 13.8 percent pickup in gross non-performing loans (NPLs) to Sh44.5 billion even as the bank’s NPL ratio remained below the industry’s average at 12 percent.

Following the improved profitability the bank has declared a final dividend of Sh3 per share taking its total payout to Sh4.75 from Sh4.25 per share or a cumulative payout of Sh4.9 billion.

“This is a very strong return to our shareholders. Our underlying performance shows momentum in all our financial drivers,” noted NCBA Group Managing Director John Gachora.

NCBA’s balance sheet has expanded to an asset size of Sh734.6 billion with loans and advances rising by 20.8 percent to Sh337 billion.

The lender’s customer deposits have surged by 15.2 percent, reaching Sh579.4 billion from Sh502.6 billion.

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