Regional lender KCB Group net profit grows to $477 million

• The Board has proposed a final dividend of $0.012 per share, bringing the total payout for the year to $0.023 per share—amounting to $74 million.
• Lender’s balance sheet closed the year at $15.13 billion (KSh1.96 trillion), powered by a strong deposit growth and stable loan portfolio.
• Operating costs grew by 11.8% to $717 million (KSh92.9 billion), driven by staff costs, and tech investments.

KCB Group profit after tax for the full year 2024 grew by 64.8 per cent to $477 million (KSh61.8 billion), attributable to strong expansion across all its businesses subsidiaries in the East African market.

This performance was an increase from the $289.5 million (KSh37.5 billion) which the bank that has presence in Kenya, Uganda, Tanzania, Rwanda, Burundi, the Democratic Republic of Congo (DRC) and South Sudan reported during a similar period in 2023.

“The strong performance illustrates our resolve over the past 3 years to build an organisation for the future that is anchored on delivering value for our customers, shareholders and all stakeholders,” noted KCB Group CEO Paul Russo during the release of the bank results on Wednesday.

The Nairobi Securities Exchange-listed Group’s balance sheet closed the year at $15.13 billion (KSh1.96 trillion), powered by a strong deposit growth and stable loan portfolio, despite the tough operating environment.

Total revenues increased 24 per cent to $1.6 billion (KSh204.9 billion) on higher interest income and non-funded income arising from foreign exchange trading income.

“Our focus is on ensuring we have fit-for-purpose technology that delivers seamless, reliable, secure, and innovative solutions for our customers,” added.

He added, “In line with, our 2024–2026 Strategy dubbed Transforming Today Together, we remain committed to the principle of Sustainability and Shared Value— unlocking impact in a meaningful and socially responsible way.”

KCB Group 2024 key financial performance highlights

According to the lender, its business diversification model continued to deliver strong benefits, with the contribution by subsidiaries (excluding KCB Bank Kenya) to the total assets standing at 34.9 per cent, while the share of profit after tax closed the year at 30.3 per cent.

What’s more, the total income increased by 24 per cent to $1.6 billion (KSh204.9 billion) from KSh165.2 billion that was reported in 2023, with net interest income posting 28 percent growth. During the year, non-funded income contributed 33 per cent of the total revenues, boosted by fees and commissions from transactions, trade finance and forex.

Operating costs grew by 11.8 per cent to $717 million (KSh92.9 billion), impacted by staff costs, technological investments, inflationary pressures and business-driven expenditure.

The Group continued to prioritize efforts to improve asset quality with provisions for expected credit losses declining by 11 per cent driven by the strengthening of the Kenya Shilling, successful rehabilitation of key NPL exposures and an aggressive recovery strategy, the lender said.

The Group’s stock of gross NPLs closed the period at $1.7 billion (KSh225.7 billion). The NPL ratio stood at 19.2 per cent, reflecting the hard economic conditions in different sectors across the markets.

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Customer loans and advances

On the balance sheet side, customer deposits closed the year at $10.8 billion (KSh1.4 trillion) and despite pressure attributable to the appreciation of the Kenyan Shilling against the US dollar, customer loans and advances stood at $7.64 billion (KSh990.4 billion) as of December 31st, 2024.

Return on equity improved to 24.6 per cent up from 17.8 per cent last year. At the same time, total equity attributable to Group shareholders increased by 20.8 per cent from $1.76 billion (KSh227.5 billion) to $2.1 billion (KSh274.9 billion), highlighting the sustained value that the lender continued to deliver for shareholders.

The Board has proposed a final dividend payout of $0.012 (KSh1.50) per share, subject to shareholder approval. This is in addition to an interim payout of KSh1.50 per share which was paid out in September 2024. This brings the total dividend payout for the year to $0.023 (KSh3.00) per share, amounting to a total of $74 million (KSh9.6 billion) for the year 2024.

“We are excited about the strong profits witnessed across all entities. We are optimistic that there will be a pickup in economic activity this year across markets, supported by resilience of key service sectors and agriculture, expected recovery in growth of credit to the private sector, and improved exports. We are continually ring-fencing our business by preserving capital and containing costs for long-term sustainability,” said KCB Group Chairman Dr. Joseph Kinyua.

“Sustainability and embedding our ESG priorities will remain key to our strategy in 2025. Leveraging the strength of our Foundation and working with the development partners, we will continue to integrate priority SDGs across the business with focus on social impact, climate action, and nature risk management” he added.

Lending to climate-related projects

Last month, KCB Bank Kenya received a $100 million tier 2 capital facility from the British International Investment (BII), the UK’s development finance institution and impact investor to increase its lending capacity to climate-related projects and women-led small and medium-sized enterprises (SMEs).

The funding will strengthen KCB Bank’s balance sheet and fund local companies scaling innovative climate technologies, including renewable energy, green mobility, and firms creating sustainable value chains in the agriculture sector.

Last month, KCB Group signed up to the Pan-African Payment and Settlement System (PAPSS), reinforcing its commitment to enhancing cross-border trade and financial integration across the continent. As the first bank in East Africa to integrate PAPSS into its systems, KCB customers will now be able to enjoy faster settlement times, reduced costs associated with currency conversion, and increased access to new markets across Africa.

PAPSS is a centralized financial market Infrastructure developed by the African Export Import Bank (Afreximbank) to facilitate cross-border payments and trade transactions, reducing both costs and processing times.

(KSh1=US$0.0077)