Economic growth: CBA first-half net profit up 3pc to Sh2.4b
Commercial Bank of Africa (CBA)’s net profit rose to Sh2.4 billion in the first-half of 2019, a 2.8 per cent improvement from Sh2.3 billion posted in a similar period in 2018.
It attributed the rise to interest income and huge reduction in operating expenses. Profit before tax was Sh4.23 billion for the half-a-year period compared to Sh3.314 billion in 2018.
A joint financial statement signed by CBA chairman, Desterio Oyatsi and Group Chief Executive Officer, Isaac Awuondo, said until the planned merger becomes effective, CBA and NIC will continue to operate and prepare ﬁnancial statements independently.
“We have so far incurred Sh200 million pre-merger costs relating to legal and other transaction advisory services and brand development, which are reported as an exceptional item,” they said.
The results indicate the bank’s total interest on income rose by 1.85 per cent from Sh9.64 billion during the period under review as compared to Sh9.82 billion in 2018.
Operating income for the period increased by 1.2 per cent from Sh10.05 billion in 2018 to Sh10.18 billion this year, mainly due to fees and commissions on loans and advances and other fees.
However, operating expenses declined by 22.8 per cent from Sh6.75 billion in the first six months to Sh5.21 billion in a similar period in 2018, mainly due to digital uptake.
The bank said business improvement was largely due its diversified income structure, prudent cost management and deliberate investments in infrastructure and digital channels.
According to the financial report, the net loans and advances for the six months period increased from Sh5.7 billion as at June 30, 2018 to Sh10.3 billion in the first half of 2019.
During the period, the loans and advances increased from Sh5.7 billion for the period ended June 30, 2018, to Sh5.94 billion this year.
Insider loans and advances to both employees and directors, shareholders and associates declined from Sh8.7 billion for the six months ended June 30, 2018, to Sh9.24 billion this year.