Net Interest Income grew to Ksh 1.03 Billion representing 11% growth
Ksh 173 Million growth in non-funded income representing 53% growth
Interest on Government Securities grew by 119 Million representing 38% growth
Interest Expense dropped by 1% to 1.05 Billion
Total Operating Income grew by 22 % to reach 1.52 Billion
Operating Expenses declined by Ksh 102 Million representing a 7% drop year-on-year
Non-performing loans reduced by Ksh 1.04 billion, an 11% year-on-year decline
The Group’s profit before tax grew to 62.3 Million, a 120% year-on-year growth
NAIROBI…HF Group continues to record improved financial position as it posted a 120% surge in profit before tax to Ksh 62.3 million for the first half of 2022, from a loss of Ksh 318.1 in a similar period in 2021.
HF Group has reported a pre-tax profit of Sh 62.3 million in the first half of 2022, a 120% percent growth from a loss of Sh318.1 in June 2021.
HF Group Chief Executive Officer, Robert Kibaara attributed the enhanced performance to the turnaround strategy focused on a diversified business model and robust risk management framework.
Non-Performing Loans portfolio reduced by 11% on the back of aggressive credit quality initiatives. This paved way for an asset re-allocation phase that has seen yield on interest earning assets increase by 30 basis points, resulting to 11 % rise in net interest income.
“We are positive that by focusing on the opportunities brought about by business diversification and maintaining superior customer experience, we will chart new frontiers of business models and continue to deliver sustainable growth in earnings,” said Kibaara.
The lender has instituted a new revenue frontier in project management which has pushed up growth of other income by Ksh 131 million, a 92% rise. This is projected to sustain the group’s profit trajectory without tying up capital in real estate projects.
“The combined effects of the increasing ratio of earning assets to total assets, increasing yield on earning assets and declining cost of funding is expected to bolster an increase in net interest margin.” Said Kibaara.
The Group’s refashioned business model has eased the bank’s funding strain as the cost of retail deposits dropped to 3.8% from 4% during a similar period in 2021. Total operating income grew by 22% while operating expenses eased by 7 %. Similarly, cost of retail deposits dropped from 4.0% in June 2021 to 3.8% in June 2022. Total deposits are up by Ksh 1.5B year-on-year. Foreign exchange income shored up by 49% underscoring the Bank’s new grip on the SME market as benefits of full-service banking continue to stream in.
