Kenyan Listed Banking Sector Quarterly Earnings and Operating Metrics
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I&M Group Summary of Performance – Q3'2022
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Profit before tax and exceptional items rose by 28.9% to Kshs 10.4 bn, from Kshs 8.1 bn in Q3'2021, with the effective tax rate increasing to
31.2% in Q3'2022, from 29.1% seen in Q3'2021. Similarly, the Group recorded a 25.1% increase in profit after tax to Kshs 7.2 bn in Q3'2022,
from Kshs 5.7 bn in Q3'2021
Total operating income rose by 24.0% to Kshs 25.0 bn in Q3'2022, from Kshs 20.2 bn in Q3'2021 mainly driven by a 15.6% increase in Net Interest
Income (NII) to Kshs 16.2 bn, from Kshs 14.0 bn in Q3'2021 coupled with a 43.0% growth in Non-Funded Income (NFI) to Kshs 8.8 bn, from Kshs 6.2 bn in
Q3'2021
Total operating expenses increased by 19.1% to Kshs 14.9 bn in Q3'2022, from Kshs 12.5 bn in Q3'2021, largely driven by a 10.2% increase in staff costs
to Kshs 4.8 bn, from Kshs 4.3 bn in Q3'2021 coupled with a 21.8% increase in other operating expenses to Kshs 6.6 bn, from Kshs 5.4 bn in Q3'2021,
The balance sheet recorded an expansion as total assets grew by 7.4% to Kshs 428.7 bn in Q3'2022, from Kshs 399.1 bn in Q3'2021, mainly attributable
the 11.4% growth in net loans and advances to Kshs 231.2 bn in Q3'2022, from Kshs 207.6 bn in Q3'2021
The group's asset quality improved, with the NPL ratio reducing to 9.5% in Q3'2022, from 10.2% in Q3'2021, owing to the 11.4% growth in gross loans to
Kshs 231.2 bn, from Kshs 207.6 bn in Q3'2021, which outpaced the 4.2% increase in gross non-performing loans
Going forward, we expect the bank's growth to be driven by:
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i. Enhanced Digitization – The bank's continued concentration on digital channels for transactions will likely see it continue generating more profit,
as they will continue to record increased usage and traffic. As of Q3'2022, 74.0% of the Group's transactions were executed digitally that saw the
increase of the value of digital transactions to Kshs 1.2 bn in Q3'2022 from Kshs 308.0 mn in Q3'2021
ii. Expansion to Retail and MSMEs lending: We expect an increase in the Group's loaning to the MSME sector, that will continue to boost the Bank's
O-Cytonn
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