Despite a difficult environment, the banking group saw its activity and earnings rebound in 2017.
Equity Group Holding, the first Kenyan bank, reported strong 2017 annual results on Thursday: at 18.9 billion shillings ($ 186 million), its annual net profit is up 14 percent from the previous year (16 , 6 billion shillings), driven in particular by an increased geographic diversification of its activities and an expansion of its revenue channels (digital growth with the Equitel digital financial service).
Another strength of the group, its cautious risk management: with a bad debt rate of 6.3% at the end of 2017, the firm is significantly better than the Kenyan banking sector as a whole (10.6%). As for total assets, they exceed for the first time the 500 billion shillings (524.5 billion shillings at December 31, 2017, or $ 520 million), up 11% on an annualized basis.
An overall performance all the more commendable that it was done “in an operational environment marked during the last two years by several bank failures, a severe drought that has impacted the agricultural sector, a prolonged presidential election, a ceiling on commercial lending rates leading to a credit crunch and finally, a slowdown in growth, “said the bank in its announcement announcement of the results.
The cap on interest rates in particular – a measure detrimental to banks’ profitability – decided by Nairobi in August 2016, forced Equity Group to readjust its assets, in particular by sacrificing loan growth for the benefit of a more stable position. conservative policy of holding more government securities.
A caution and resilience that seem to pay today, given the latest results communicated and the evolution of the action: over a year, the price has risen by more than 75% on the Nairobi Stock Exchange, excluding dividends
