Equity Bank’s Profit After Tax increased by 99 percent to 40.1 billion shillings from 20.1 billion shillings with Profit Before Tax recording a growth of 134 percent to 51.9 billion shillings up from 22.2 billion shillings the previous year.
The Group has recommended a record dividend payout of 3 shillings per share totaling 11.3 billion shillings which is a 50 percent jump from previous dividend pay-out after earnings per share grew by 98 percent to 10.40 shillings up from 5.20 shillings the previous year.
Net interest income grew by 25 percent to 68.8 billion shillings up from 55.1 billion shillings. This was driven by a 23 percent growth in loan book to 587.8 billion shillings up from 477.8 billion shillings and an 81 percent growth in investment in Government securities to 394.1 billion shillings up from 217.4 billion shillings.
Non-funded income grew by 15 percent to 43.6 billion shillings up from 37.8 billion shillings driven mainly by trade finance, payment channels, and foreign exchange trading income. Trade finance registered a 55 percent growth in revenue to 3.2 billion up from 2.1 billion shillings.
Despite zero-rating mobile transaction offerings, transaction income grew by 37 percent to 10.4 billion shillings up from 7.6 billion shillings on the back of the E-commerce and Merchant banking business.
Foreign exchange trading income grew by 33 percent to 8.3 billion shillings up from 6.2 billion shillings driven by diaspora inflows that grew 37 percent to reach 383.5 billion shillings up from 279.4 billion shillings.
Total income grew by 21 percent to surpass the psychological USD 1 billion mark to record 112.4 billion shillings up from 92.9 billion shillings the previous year.
Despite a 24 percent growth in staff costs to 19.1 billion, growth in other operating costs to 36.5 billion shillings up from the 30.6 billion shillings, total costs recorded a decline of 16 percent to 60.5 billion shillings down from 71.9 billion driven by an 81 percent decline in loan loss provision to 4.9 billion down from 25.9 billion the previous year.
Portfolio at risk declined to 8.3 percent down from 11 percent with non-performing loan coverage increasing to 98 percent up from 89 percent. In absolute terms, total non-performing loans declined to 44.5 billion down from 50.6 billion.
Total Assets grew by 29 percent to 1.305 trillion shillings up from 1.015 trillion shillings driven by a corresponding 29 percent growth in customer deposits to 959 billion shillings up from 740.8 billion shillings resulting in excess cash being deployed in low yielding government securities at 9.6 percent, while the cost to income remained fairly constant at 49.1 percent up from 48.5 percent.
Return on Average Equity expanded to 26.1 percent up from 15.3 percent while Return on Average Assets grew to 3.5 percent up from 2.3 percent on the back of benefits of economies of scale and efficiencies of digitization and a shift of business model from fixed costs to variable cost resulting in the enhanced returns.
“We have strengthened our business model to achieve an embedded shared value concept in our twin-engine of social and economic aspirations and deliverables. We have scaled our social and environmental impact investments in capacity building and enhancement through education, health, and entrepreneurship training,” said Dr. Mwangi.
To strengthen resilience and expand economic opportunities for young people and women, Equity Group Foundation (EGF) scaled up capacity building for Micro, Small, and Medium Enterprises (MSMEs) through the provision of Financial Literacy, Entrepreneurship Training, and Digital Literacy under the Young Africa Works (YAW) program in partnership with Mastercard Foundation. This resulted in 436,000 MSMEs being enrolled into the program, with over 316,000 of these MSMEs cumulatively trained, 200,000 MSMEs accessing Kshs 136 billion in loans, and 1.2 million jobs created.