National Bank of Kenya (NBK) has posted Sh765million net profit for the half year ending June 30, 2021 on increased deposits, loans and advances.

Increased income from loan interest and foreign exchange trading, coupled with lower loan loss provisions saw net profit surge by 307 per cent compared to a similar period last year.

Net interest income grew by 21 per cent from the previous year to stand at Sh4.1 billion.

This follows growth in interest income which increased by 24 per cent to Sh5.8 billion due to increased volumes of loans and advances as well as sustained recoveries.

NBK managing director Paul Russo said in a statement that growth in interest paid hit Sh1.7 billion on 30 per cent increase in customer deposits, from transactions on the revamped digital channels.

Subsidiary

The lender is a subsidiary of KCB Group Plc. Established in 1968 to boost Kenyans’ access to finance, it has grown to be one of the largest commercial banks in the country with a growing network of 85 branch outlets across the country.

In September 2019, the bank became a subsidiary of KCB Group Plc following a successful acquisition

“This has been a strong first half that will ensure we help our customers reposition for the awaited economic recovery going into the second half of 2021.

We believe the new phase of normalcy will unveil growth opportunities for our customers and the Bank.

Operating costs during the half year remained flat at Sh4.1 billion over a similar period in 2020.

This was despite increased investments in enhanced cybersecurity measures and revamp of the core banking system. 

“Our capital and liquidity levels are secure enough to support our outlook for the rest of the year’s prospects for growth in our balance sheet, delivering an upturn in revenue growth and profits projected for 2021,” Russo said.

Total assets grew by 12 per cent to Sh134 billion, driven by growth in net loans and advances, which were up 20 per cent to Sh60 billion.

This was supported by relatively flat customer deposits at Sh99.7 billion sustained at the high levels due to increased inflows among existing clients and new accounts in corporate and retail. This included the bank’s Islamic banking business units.