BK Group posted strong half-year results for 2021 despite a period it described as “very difficult” due to the Covid-19 pandemic, but still managed to achieve significant growth in its revenues and active.
The group announced its half-year results on Wednesday, September 1, with Chief Executive Officer (CEO) Dr Diane Karusisi saying the financial institution has defied two lockdowns and other restrictions that have constrained economic activity, to post solid results .
âOur net income increased by 41.5%, which is very commendable. Our assets have grown significantly by 20.4%. This is mainly due to an increase in net lending of almost 16% â,
âWe also saw very good growth in our deposits, of 14.2%, and that’s something we’re very happy to see. We saw very good business activity in the first half as well as improved business flows and that is why we are posting significant results, âDr Karusisi told reporters at a press conference to announce the results.
She pointed out that BK has kept a very cautious stance on impairments by keeping a very high cost above 4% due to the fact that the Covid-19 pandemic has not yet subsided.
However, Dr Karusisi said they are betting on the hope that with the ongoing mass vaccination campaign, at least 50 percent of the country’s urban adult population will have been vaccinated, which could lead to an end. record year.
âLooking at the progress over the past few weeks, we hope that we will reach over 50% by the end of the year,â Karusisi said, stressing that the bank will only be able to gradually release provisions after seeing an improvement in the vaccination rate. .
Nathalie Mpaka, COO of BK, said the bank has managed to show strong balance sheet growth and increase profitability at the same time, regardless of the challenges.
“Our profit after tax increased 41.5% year-on-year and 4.2% quarter-on-quarter,” he added.
“We are very pleased with the results, mainly due to the expansion of our loan portfolio, mainly to large companies, followed by a slight increase in the SME and retail segment,” Mpaka said, adding that on the side on the liabilities side, the bank sees very good growth in customer deposits.
She said deposits were up 14.2% year-over-year and they expected this to continue in the second half of the year, while equity rose 17.2% , to reach Rwf 271 billion, which is net of the 50% dividend provision for current year shareholders approved in the previous Annual General Meeting (AGM).
BK Group Plc reported net income of Frw 11.6 billion, reflecting a 17.7 percent year-over-year increase, with an average return on assets (ROAA) and average return on equity (ROAE) reaching 3.4 percent and 17.2 percent respectively for the period ended June 30, 2021.
The bank’s total assets grew 20.4% year-on-year to Rwf1 1405.5 billion in the first half, while net loans and advances increased 15.9% year-on-year last, to Rwf 916.0 billion.
BK customer balances and deposits increased 14.2% to Rwf857.1 billion, while equity increased 17.2% year-on-year to reach Rwf 271.1 billion at the end of the year. end of the first half of 2021.
Total interest income increased 28.2% year-on-year to Rwf 85.9 billion, supported by higher income from loans and advances, which increased 17.5% year-on-year to reach 1 trillion Rwf.
BK’s total interest charges increased 22.5% to Rwf 18.6 billion, in line with 14.2% annual growth in customer deposits to Rwf 857.1 billion
The overall growth of the bank’s net interest income was 29.9% to RWF 67.2 billion; with a net interest margin increasing to 11.1% against 10.7% in fiscal 2020.
Banque de Kigali recorded a year-over-year increase in non-interest income of Rwf16.2 billion, or 26.4%, mainly due to increased volume of trade and activities economic.
The bank’s total operating income grew 29.2% to Rf 83.4 billion, while total operating expenses rose 18.9% year-on-year to Rr 27.4 billion. by Frw.
The bank said its cost-to-income ratio was in line with that at the end of 2020 at 32.8% and loan loss provisions stood at Rwf 22.2 billion, reflecting a 21.5% increase in year-over-year.
Although the bank’s asset quality generally improves, non-performing loans were at 6.6 percent, which is above the industry average of 5.9 percent.
The bank said the percentage of COVID-19 loans on moratorium was reduced to 4.1% of gross loans from 47% of restructured facilities.
âAs of June 30, 2021, BK Group Plc is properly capitalized with total capital to risk weighted assets of 22.0%. The group’s total assets amounted to RWF 1,405.5 billion; up 20.4% year-on-year â
âThe net loans / total assets ratio stood at 65.2%. The total balance of dividends payable was Rwf 24.7 billion, including Rwf 13 billion of dividends payable for 2019 and a payout rate of 50% for current year profit. Equity increased to Rwf271.1 billion, up 17.2% year-on-year, âsays BK’s financial report.
By the end of June, BK had served more than 356,900 individual customers and more than 26,000 corporate customers. The bank had 68 branches, 96 ATMs, 2,895 points of sale and expanded its branch network to 2,692 agents across the country who processed more than 2.8 million transactions worth $ 289. 9 million Rwf.
Retail customer balances and deposits reached Rwf 242.2 billion in the first half of the year, while corporate bank customer balances and deposits amounted to Rwf 478.5 billion. BK’s mobile service âBK Quickâ registered 111,350 subscribers who carried out Rwf4bn transactions.
BK’s IKOFI portfolio has registered over 1,800 agro-dealers and agents as well as over 262,700 registered farmers.
The group insurance subsidiary, BK General Insurance recorded a profit of Rwf 1.19 billion compared to a profit of Rwf 1.39 billion recorded in the first half of 2020.