Whistleblowing
Equity Bank’s third quarter profits soar 42% higher
Nairobi 24th October 2011…Regional financial solutions provider Equity Bank Group has defied economic storm and prevailing challenges to post a 42% after tax profit in its third quarter operations.
Despite the challenging economic environment, Equity Bank Group anchored firmly on a strategic focus on customer convenience, satisfaction and diversified delivery channels managed to post a 42% after tax profit to close its September 30th trading period books at Kshs 7.3billion up from Kshs 5.1 billion registered during the same period last year.
The Bank’s profit before tax grew to Kshs 9.1billion up from Kshs 6.5billion fueled by a total income growth of 24% up from KShs 16.5 billion to KShs 20.5 billion in the same period.
Sustained marketing efforts under the bank’s Equity ‘Ndio Hii Hapa’ campaign resonated well in the market, with the bank’s customer base continuing to grow and has now hit the 6.7million mark making Equity Bank the largest bank by customer base in sub Sahara Africa.
Within the same period, deposits grew by 51% to close at Kshs 149.7 billion up from Kshs 99.2 billion posted during the same period last year in a move attributed to the bank’s fast expanding Equity Agents customer delivery channel and Financial Literacy (FiKA ) training initiative.
Speaking when he released the bank’s third quarter results during a breakfast investor briefing session at Equity Centre, Equity Bank Group Managing Director Dr. James Mwangi disclosed that the bank will maintain its strategic focus in the fourth quarter to sustain the current growth momentum.
“Although the operating environment is expected to be challenging especially due to the inflationary pressures arising from high fuel and food prices, our customer and shareholders promise to deliver on the strategic objectives remains on track,” Dr. Mwangi said. And Added: “going into the fourth quarter, we anticipate better performance for the group with sustained focus on further increasing our customer value proposition.”
Dr Mwangi attributed the more than impressive results and achievements to staff motivation and productivity, improved efficiency, resilience and robustness of the Equity business model, the benefits of economies of scale arising from size and growth; and improved quality of the loan book.
In tandem with the growth, the bank’s total operating expenses also grew by 14% up from Kshs 10 billion to hit the Kshs 11.5 billion mark in a development attributed to a 9% increase in staff costs which now stands at Kshs 4.1 billion while the Group’s cost to income ratio improved from 50 % to 48 % in the same period
The asset quality improved by 53% to 1.3 % from 2.7% for the same period despite Loans and advances growing by 54% to Kshs 109.4 billion up from Kshs 70.9 billion posted in the same period.
During the period under review, non-interest income grew by 15% up from KShs 8.1 billion in Sep-10 to close at Kshs 9.3 billion driven mainly by transactions income, fees and commissions’ income.
Equity Bank Group’s total assets grew by 43% to close at Kshs 195.4 billion up from Kshs 136.6 billion in September 2010 with the most significant growth being achieved in the core operational segments featuring loans and advances and cash and bank deposits which grew by 54% and 112% respectively.
Equity Bank’s performance comes at a time when the bank has been feted and recognized globally for its interventions at the bottom of the pyramid, SMEs and in agriculture. Africa Investor in Sept 2011 in Washington recognized Equity Bank as the Best Initiative in Support of SMEs and the Millennium Development Goals while Dr. James Mwangi was named as the African Banker of the Year for the second year running at the 2011 African Banker Awards during IMF/World Bank annual meetings. The World Economic Forum recognized Equity Bank as the only financial service provider in the Emerging markets which meets the threshold of sustainability based on a criteria covering, innovation, growth and corporate sustainability.
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