Equity Bank Group strengthens its fundamentals while expenses of ICT, Innovation and Product Rollout Slows Profit Growth To 7%


Equity Bank Group’s focus on enhancing affordability, accessibility and convenience has seen its growth momentum maintained for the period ended 30th September 2013.


The regional banking group has posted a 17% growth in customer deposits, a growth of Kshs.28 billion to Kshs.190 billion up from Kshs.162 billion. The impressive growth has been enabled by massive investment in agency banking and mobile banking facilitating easy accessibility convenience and affordability. Customer numbers have now grown to 8.5 million signifying an achievement in pursuit of inclusive banking.


Bolstered by a 30% reduction in interest rate and a focus on the SME segment, the group’s loan book registered a 21% growth to Kshs.159 billion up from KShs. 136 billion posted in September 2012. However the interest income grew by only 4% to Kshs.23.6 billion up from Kshs.22.7 billion as a result of reduction of chargeable interest rate.


Other income, transactions and commission grew by 12% to Kshs.10.6 billion up from Kshs.9.4 billion on the back of increased number of customers due to greater affordability, accessibility and convenience delivered through sustained innovation, agency banking, mobile banking, payment connectivity and investment in ICT solutions.


The number of customers using mobile banking has increased to 2.7 million up from 2 million as at 30th September 2012 while the number of operational agents has grown to over 9,000.


Total operating expenses grew by 19% to Kshs.17.6 billion from Kshs.14.9 mainly driven by operating costs that grew by 15% and provisions to take care of the trailing effects of last year’s high interest rates on NPLs. Operating costs were driven by significant costs of creating the agency network and costs of developing, hiring and training staff to manage SME sector and build Supreme Banking centres. ICT costs have increased significantly as the group upgraded its system and data centre, trained staff in simulating the change of its core banking software from Finacle version 7 to Finacle version 10. As a result profits of the group grew by 7% to KShs 12.6 billion up from Kshs 11.8 billion before tax. Profit after tax grew to Kshs.8.9 billion up from KShs 8.3 billion last year.


Equity Group in the last one year has invested massively in creating infrastructure for merchant business, diaspora remittances and banking and transaction processing by connecting to all global payment systems, American Express (AMEX), Diners Club, Visa Personal Payments, MasterCard, JCB of Japan, Union Pay of China and digital payments offered by Google and PayPal. Equity Group has also invested in a 300 seat Contact Centre to handle customer enquiries through calls and social media platform such as Facebook and Twitter.


In addition the Group has also invested in 3 of the latest and world’s largest IBM Power 7 servers enabling it to increase its processing capability massively and achieve a high availability environment. The Group has also invested significantly in upgrading Way 4 switch, payment gateway and mobile banking by the purchase of an ORACLE Super Cluster to enable migration of its switch, payment gateway and mobile banking system.


In July, Equity Group entered into a partnership with Airtel Money to offer comprehensive M-Commerce solutions to more Kenyans countrywide. The service is available to all Equity Bank customers who are subscribers of Airtel thus enabling them to perform agency cash transactions at Equity branches and has also enabled Airtel money customers to withdraw and deposit money at any Equity Bank branch or Agency Countrywide


“With the fundamentals strengthened, massive investment made and improving macro-economic environment creating huge opportunities, the outlook for 2014 looks promising,” said Dr Mwangi.

Related stories

Equity Group Holdings Limited Appointments

Click here to see the latest

View More
Equity Group Secures Its Shareholders Nod for a Kshs 20 Billion Pan African Expansion Bid

The approvals, which were secured during the firm’s 11th Annual General Meeting (AGM) held today...

View More
Equity Bank Upgrades Core Banking System

Equity Bank core banking system has now been upgraded to Finacle 10. The enhanced solution allows...

View More
Regional Expansion and Diversification Strategy Pays Off as Equity Bank Posts a 21% Growth

Emerging from a depressed operating economic environment as well as challenges posed by the recent...

View More
Equity Bank’s Focus on Innovation Boosts First Half Year 2013 Profit

Regional banking group, Equity Bank's reduction of interest rates by 700 bps from 25% to 18% has...

View More
Equity Bank's Strategy Increases Profits by 36 Percent

The Group’s total assets posted a 24% growth during the year to close at Ksh 243 billion up from...

View More
Equity Bank S. Sudan Opens 9th Branch

Equity Bank South Sudan has opened its 9th branch. Torit branch in the Eastern Equatoria State was...

View More
MasterCard and Equity Bank Announce Partnership to Introduce PayPass™ Enabled Cards

MasterCard and Equity Bank of Kenya today announced an agreement at a signing ceremony in Nairobi to...

View More
Equity Group Foundation Appoints Dr. Helen Gichohi as Managing Director

Dr. James Mwangi, Equity Bank Group CEO and Chairman of Equity Group Foundation has announced the...

View More
Dr. James Mwangi Wins ‘forbes Africa Person of the Year Award 2012’

Dr. James Mwangi, Chief Executive Officer and Managing Director of Equity Bank in Kenya, was named...

View More
Orange Launches Visa Card in Partnership With Equity Bank

Orange launches Visa card in partnership with Equity Bank.

View More
Equity Bank Group Partners With China Union Pay

Equity Bank Group has today launched a partnership with China Union Pay, which will allow UnionPay...

View More
Equity Bank Group Pre-tax Profit Up by 30%

The group has posted a profit of Kshs.11.8 billion up from Kshs.9 billion realized in the third...

View More
Equity Bank South Sudan Opens 8th Branch

Riding on a growth trajectory that has positioned it as a market force, Equity Bank South Sudan...

View More
Appointments at Equity Bank Group

Dr James Mwangi today at Equity Centre announced two key appointments in the Equity Bank Group’s...

View More
Equity Bank Ceo Gets Two Appointments

Dr Mwangi will serve as a council member of the G8 New Alliance for Food Security and a member of...

View More
Equity Bank Ceo Joins Global Alliance for Food Security and Nutrition

Equity Bank Group CEO, Dr. James Mwangi has joined the Global Alliance for Food Security and...

View More
21 Equity Bank Scholars Receive Scholarships to Study in World Leading Universities in 2012

21 scholars in the Equity Bank university sponsorship program have so far received scholarships in...

View More
Equity Bank Profit Before Tax Grows by 29%

During the period under review, Equity Bank Group’s loan book grew by 27% from Kshs 97.7 billion...

View More
James Mwangi: Africa's Inclusive Finance Guru Is World's Best Entrepreneur

Corporate Communications July 21, 2012

View More
250 Top Kcse Scholars to Benefit From Equity Bank's University Sponsorship Programme

Two hundred and fifty top performers in last year’s Kenya Certificate of Secondary Education are...

View More
Equity South Sudan unveils a new identity in line with the Group’s ongoing journey of transformation.

Brand refresh geared towards inclusion, innovation, growth, progress and relevance

View More
Equity Bank South Sudan Scoops Top Honours at The Banker’s Bank of the Year Awards 2020

For the second year running, Equity Bank South Sudan has received the Bank of the Year South Sudan...

View More
Service finder
Equity Bank is Regulated by Bank of South Sudan