Kenyan financial services conglomerate I&M Bank Group reported robust financial results in 2021 as increased interest income coupled with reduced interest expenses delivered a strong double-digit surge in profit in the first nine months of 2021.
The financial services giant posted a profit of Ksh5.7 billion ($51 million) from January to September 2021, which represents a 25-percent increase when compared to the Ksh4.6 billion ($4.1 million) in profit that it reported during the same period a year ago.
I&M Holdings, or I&M Group, is the Kenya-based non-operating holding for I&M Bank Limited. It operates through its banking subsidiaries in Kenya, Tanzania, Rwanda, and a joint venture in Mauritius.
Since the bank’s founding in 1950 by Shah, who holds a substantial 10.8-percent stake in the banking group, it has grown its operational footprint to other countries in the region.
Its expansion is evident in its recent acquisition of a 90-percent stake in the Ugandan bank, Orient Bank Limited.
The group’s profit in the first nine months of 2021 was driven by its assets and revenue diversification strategy, which led to the 15.73-percent growth in interest income to Ksh22.8 billion ($202.6 million), and a 5.2-percent decline in interest expenses.
Despite an increase in operating expenses driven by higher wages and salaries paid to the staff and loan loss provisions for the period, the strong double-digit growth in net-interest income spurred revenue above the $51-million mark.
As a result of this strong performance, the value of the group’s assets rose from Ksh344.7 billion ($3.0 billion) in 2020 to Ksh399.1 billion ($3.5 billion), while the value of the shareholders’ equity stake grew from Ksh60.5 billion ($537.6 million) to Ksh68 billion ($604.3 million).
As of press time, Nov. 30, shares in the group were worth Ksh21 ($0.1866) per share, 48-basis points higher than their opening price on Mon., Nov. 30.
At this valuation, the group’s market capitalization is estimated at Ksh17.4 billion ($154.6 million).