Equity Group Holdings, a leading financial services conglomerate based in Nairobi and led by Kenyan businessman James Mwangi, has demonstrated resilience in its financial performance, delivering a single-digit percent increase in profit for the first half of 2023.
According to the recently published financial results, Equity Group, under the leadership of Mwangi, reported a profit of Ksh26.33 billion ($182.8 million) in the first half of its 2023 fiscal year, marking a substantial 7.8-percent surge compared to its profit of Ksh24.43 billion ($169.63 million) during the same period in 2022.
This resilient financial performance is notable given the challenging macroeconomic environment marked by persistent high inflation, elevated interest rates, fluctuating exchange rates, and the depreciation of emerging market currencies.
The conglomerate’s robust financial performance, resulting in single-digit percentage growth in profit for the first half of 2023, was driven by exceptional performance across all its operating segments.
Equity Group’s net interest income witnessed a 16.6-percent rise to Ksh46.4 billion ($322.2 million), attributed to increased lending activities. Additionally, non-interest income experienced a 42.9 percent surge, reaching Ksh36.5 billion ($253.44 million).
Announcing the half-year financial results, Mwangi, group managing director and CEO, emphasized the strategic positioning that enabled the conglomerate to withstand the prevailing macroeconomic challenges.
Mwangi noted: “Our strategic pursuit has resiliently positioned us to weather the macroeconomic headwinds and turbulence. Regional geographical expansion and business diversification have seen reliance on the contribution of the Kenyan banking subsidiary reduced with other subsidiaries contributing 46 percent of total assets and 45 percent of profit before tax, driven primarily by insurance and the DRC business.”
Mwangi, who derives the majority of his wealth from a 3.38-percent stake in Equity Group, further highlighted: “The drive to non-funded income growth registered good success with total income growing at 24 percent driven by a 42-percent growth of non-funded income and 17-percent growth of net interest income. Gross trade finance revenue grew by 117 percent with trade finance related lending growing by 46 percent, FX total income grew by 68 percent, and diaspora flows grew by 146 percent to account for 12 percent of all client FX volumes.”
As a result of its robust financial performance, Equity Group witnessed a 23-percent increase in total assets, from Ksh1.447 trillion ($10.05 billion) at the start of the year to Ksh1.644 trillion ($11.4 billion) as of June 30. Additionally, retained earnings expanded from Ksh189.57 billion ($1.32 billion) to Ksh199.94 billion ($1.38 billion), further solidifying its status as one of Africa’s most profitable banking groups.