May 30th 2017

Business / Markets

Wide use of agents, mobile money catapults Equity’s profits to Sh14.2 billion

The bank also reported an increase in the customer base from 9.7 million accounts to 10.7 million accounts during the year. Customer deposits in the Kenya grew by 10 per cent to Sh259 billion up from Sh236.4 billion.

By Free Press Reporternewsdesk@kenyafreepress.comMonday, 22 Aug 2016 18:25 EAT

Equity Bank has reported a profit before tax of Sh14.2 billion for the last business year. The bank made a profit of Sh12.1 billion last year. After tax profit increased from Sh8.6 billion to Sh10.1 billion during the same period, according to figures released by the bank today.

The bank attributed its increased earnings to enhanced efficiency arising from digitization and increased use of agents, mobile, merchant and internet banking platforms.

“Uptake of the mobile channel during the year grew by 115 per cent with 2,196,000 clients having registered on the Equitel platform. Equitel mobile transactions grew by 271 per cent during the year to reach 97.8 million up from 26.4 million transactions. The value of transactions grew to Sh149.3 billion up from Sh16.4 billion, a growth of 811 per cent reflecting the increasing confidence in and acceptance of digital money,” the bank said in a statement.

Equity said that its interest earning assets grew by 19 per cent to Sh342 billion up from Sh287.4 billion driven by a 44 per cent growth in government securities which grew to Sh73 billion up from Sh50.6 billion and a 14 per cent growth in net loan book to Sh269 billion up from Sh236.8 billion. Interest income grew by 35 per cent to Sh26.1 billion up from Sh19.3 billion mainly driven by a 37 per cent increase in interest income on government securities as a result of the growth and enhancement on yields by 25 per cent.

The bank also reported an increase in the customer base from 9.7 million accounts to 10.7 million accounts during the year. Customer deposits in the Kenya grew by 10 per cent to Sh259 billion up from Sh236.4 billion, Equity reported.

The bank also reported that it has captured 10 per cent of market share in total assets, customer deposits and loans of the banking industry in Kenya. Equity said it now commands 59 per cent of industry agency banking transactions and 52 per cent of industry merchant banking volume and is the only bank with secure SIM card based data encrypted mobile banking.

The bank also reported a lower-than-average portfolio of non-performing loans, which stood at 4.2 per cent against an industry average of 8.4 per cent. It reported paying low interest on liabilities due to a cost effective funding comprising of 72 per cent customer deposits, 17 per cent shareholders funds and 9 per cent long-term funds with 76 per cent of customer’s deposits being current account and savings deposits.

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