Increased earnings from loans pushed up Absa Bank Kenya’s profit after tax for the first nine months of the year by 20 per cent to Sh14.7 billion.
In results released on Tuesday, the lender said it disbursed loans worth Sh311 billion, with new gross lending of Sh94 billion directed towards critical sectors of the economy.
“Total revenues increased by 16 per cent, totaling Sh46.8 billion, bolstered by funded income of Sh34.5 billion. Additionally, non-funded income grew by 13 percent, amounting to Sh12.2 billion,’’ said the bank.
Absa Bank Kenya MD, Abdi Mohamed said the growth in revenue highlights both the solidity of legacy revenue streams and the rapid expansion of new income sources, including asset management and brokerage.
Customer deposits increased slightly to Sh352 billion, defying the tough economic environment, an aspect the lender attributes to sustained confidence in Absa as a primary financial partner.
The increased lending, however, exposed the lender to high impairment costs, which rose 19 per cent to Sh8 billion.
Despite this increase, Absa Bank Kenya says it continues to maintain healthy portfolio quality and has established a sufficient coverage ratio to effectively minimise and manage potential future credit losses.
The bank’s capital and liquidity ratios remain strong with sufficient headroom above the regulatory requirement.
The Bank’s total capital
adequacy ratio closed the quarter
at 19.4 per cent and liquidity reserve
position at 38.1 per cent against the
regulatory limits of 14.5 per cent.
