Despite the interest rate cap in Kenya, Kenya Commercial Bank Group recorded good performances in 2018, Ecofin Agency noticed from data published on the Nairobi Securities Exchange. The group’s net result during the period under review rose by 12% year on year to reach Ksh24.4 billion.

Its tier 1 (social capital+reserves) rose from 17.1% to 20.5%, up by 12.5 percentage points compared with the minimum required by the central bank (8%).

In addition, its tier 1 capital ratio is now 18.1%, higher than the 10.5% regulatory level. In addition, the group’s liquidity ratio is up by 13% compared with the regulatory ratio which is 20%.

Its administrative board has decided on the distribution of a Ksh3.5 dividend per share, Ksh0.5 higher than in 2017.

The group’s share ended the trading of March 7, 2019, with its third consecutive rise after seven days of consecutive losses. Investors seem to have appreciated the group’s performance recorded amid interest rate caps that undermine banks’ capacity to generate profits that are proportional to risks taken.

Yet, Kenya Commercial Bank Group still shows some signs of vulnerability. Its revenues barely grew and the rise in its interest income was affected by the rise in savings account interests and a decrease by about Ksh2.7 billion of the charges and interests.

Its net banking products grew by Ksh4.3 billion year on year thanks notably to the decrease in provisions for risk credits and staff expenses.

Idriss Linge