Barclays Kenya Posts 12% Profit Before Tax Growth In Q1 2019

Barclays Kenya Posts 12% Profit Before Tax Growth In Q1 2019

Barclays Bank of Kenya Ltd has today reported a profit before tax of Kshs 2.9
billion for the period ended 31 March 2019, a growth of 12% compared to a similar period last year. The performance is mainly attributable to a 3% growth in total income and a 3% drop in costs.

All business segments recorded double-digit growth in deposits year on year. Customer deposits grew by 16% to Kshs 224 billion with transactional accounts constituting 66% of the total deposits.

Barclays Kenya Posts 12% Profit Before Tax Growth In Q1 2019
Barclays Kenya Chief Executive Officer Jeremy Awori at a previous media engagement

Net customer loans and advances grew by 9% to close at Kshs180 billion driven by key focus products namely trade, asset finance, mortgage and scheme loans that recorded strong growth year on year. Other funding was deployed to investments in government securities and trading that increased by 38% to Kshs 117 billion.

During the period, total income increased by 3% to Kshs 8 billion. Net interest income posted a 1% reduction mainly driven by a drop in the base lending rate by 100bps compounded further by growth in the cost of funding.

Non funded income was up 14% year on year driven by various streams including Timiza, foreign exchange earnings and fixed income trading.

The bank incurred one-off costs amounting to Kshs 243 million – reported under exceptional items – in the ongoing separation from Barclays Plc and the related brand and name change
initiatives.

Update on Separation from Barclays Plc and Re-Branding to Absa

Over 2016 & 2017, Barclays Plc reduced its shareholding in Absa Group Limited from 62.3% to 14.9%.

After this, a comprehensive transition programme was set up to manage the
separation of systems & capabilities from Barclays Plc. The Separation programme is expected to transform them into a more scalable and digitally-led bank. In addition, the Separation programme will consolidate and digitize core technology
services.

This will significantly improve their existing solutions and enhance service delivery to
our customers.

“In 2019, the bank’s Separation programme will involve immense investments and
implementation of over 70 technology-specific projects, which will further eliminate service dependency on Barclays Plc and move the bank to superior efficient, robust and customer centric systems. I am happy to report that all technology changes achieved so far have been
implemented with minimal impacts on our customers.

We intend to keep all our stakeholders informed and engaged through various activities and brand awareness initiatives throughout the year. Overall, 2019 is critical for the Separation programme, with multiple critical projects set for delivery.” – Barclays Kenya Chief Executive
Officer Jeremy Awori said.

“We have stepped up our engagement with our customers and the society through various activities. Early this year, Absa Group was the presenting sponsor of the Magical Kenya Open Golf Tournament, which was – for the first time – part of the prestigious European Tour. This has had a massive positive impact on the development of professional golf in Kenya.
As part of our effort to inform our customersabout the Absa brand, we have also launched communication campaign that showcases the credentials of the Absa brand and the positive impact it has made on the African continent. We will intensify our customer engagement activities as we inch closer to the launch date.

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