Absa Bank Kenya, a Nairobi-based commercial bank led by Kenyan businessman and CEO Jeremy Awori, reported triple-digit earnings growth at the end of its 2021 fiscal year, owing to a steady increase in interest and non-interest revenue.
Absa Bank Kenya, originally Barclays Bank Kenya Limited, is a Kenyan financial services group and a part of the Absa Group Limited of South Africa. Its core operations include retail, corporate, treasury and card services, as well as cross-functional partnerships to benefit local enterprises and SMEs.
According to figures contained in its 2021 financial report, profit increased by 161 percent from Ksh4.16 billion ($36.4 million) in 2020 to Ksh10.87 billion ($95.1 million), supported by a seven-percent increase in interest and non-interest income, as it was able to leverage the strong recovery in the economy and its operating environment to create value for investors.
Aside from the continued growth in interest and non-interest income that fueled the bank’s strong financial performance in 2021, the triple-digit earnings growth was supported by a decrease in operating expenses and a significant reduction in impairments.
As a result of the bank’s financial performance, assets increased by 13 percent from Ksh379.44 billion ($3.32 billion) in 2020 to Ksh428.7 billion ($3.75 billion), supported by a six-percent increase in customer deposits, while shareholder funds rose from Ksh46.5 billion ($406.8 million) to Ksh56.45 billion ($493.8 million).
While commenting on the financial performance and management plans, Awori, the commercial bank’s managing director since 2012, stated that the changing operating environment required management to take immediate steps to preserve capital and liquidity.
He went on to say that these actions, which included providing assistance to clients through different interventions and capacity development for SMEs, paid off handsomely, resulting in improvements in the quality of the bank’s loan book and the health of its balance sheet.
The bank’s board of directors proposed a final dividend of Ksh1.1 ($0.00962) per share, payable on or about May 26. This is the bank’s first payout since the pandemic, with earnings surpassing 2019 levels.