NIC Profits up 71 per cent, breaks the norm

Posted on February 24, 2011


NIC Bank MD Mr James Wachira, the bank posted a 71% PBT full year 2010

Unknown to many including journalists that covered the event, NIC Bank today broke the norm in its 50 plus years of operations.

The bank for the first time hosted an investor briefing at the Serena Hotel to release its 2010 report card that all looked impressive.

With profit before tax of 71 per cent for the period, this called for more than just the usual press conference or press release that has marked the banks history but a Celebrations.

The significance of this could have been that the bank is sending warning that it is time it got to a tier one bank and competed with the likes of Barclays Bank, Kenya Commercial Bank and Equity Bank.

Announcing the financial results, Mr. James Macharia, the Group Managing Director, attributed the impressive results to the rebound in all key economic activities in Kenya.

Mr. Macharia further attributed the Group’s positive performance to the favorable results of the Bank’s subsidiaries.

Net Interest Income recorded a commendable increase of 41 per cent (Shs985 million), despite the mid year reduction in the Base Lending Rate and the increase in deposit base by Shs9 billion.

“Non Funded Income continues to contribute significantly to the overall profitability of the Group. At this level, it is an indicator of diversification of our income streams,” said Mr. Macharia.

With a total asset base of Shs59 billion, representing a 24 per cent growth year on year, the Group MD noted that the Bank is now a key player in the Kenyan financial markets.

The Group’s loan book recorded a 25 per cent growth rate to close at Shs41 billion from Shs32 billion reported in last year.

To fund this growth in advances, the Bank’s deposit base grew from Shs39.5 billion in 2009 to Shs48.5 billion in 2010, an increase of 23 per cent.

Despite the expansion in the Bank’s outlets and establishment including human resources, total operating expenses were well contained growing by 13 per cent over the previous year to Shs2.6 billion.

This compares well with the growth in total income, which increased by  36 per cent, from Shs3.8 billion in 2009 to Shs5.2 billion in 2010.

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