Barclays posts flat earnings amid Sh560m rebranding cost

Barclays Bank of Kenya (BBK) #ticker:BBK profits have remained flat as it reported Sh3.88 billion after-tax earnings for the period ended June 30 compared to Sh3.76 billion for a similar period in 2018.

“The performance is mainly attributable to a four percent growth in total income, three percent drop in operating costs and four percent drop in impairment,” said the lender in a statement.

Profit after tax normalised rose by 13 per cent to Sh4.3 billion. The lender channeled Sh560 million towards rebranding to Absa, a process that is expected to be concluded at the end of the year.

“Our transition journey to Absa has now gained momentum and is about 65 percent complete,” said Barclays Kenya MD Jeremy Awori.

Operating expenses saw a marginal drop to Sh10.05 billion from Sh10.38 billion.

Non-interest income, which comprises fees and commissions, dividend income and foreign exchange income, grew 12 percent to Sh5.29 billion up from Sh4.7 billion. The lender’s net interest income, including loans to customers and government securities, rose by seven percent to Sh15.18 billion. This was a result of a slight growth in the interest from loans and government securities. Total income rose by four percent to Sh16.3 billion while total assets grew by 11.75 percent to 353.84 billion, with the lender attributing it to growth in government securities and other liquid assets.

It grew its loan book by five percent to Sh186.66 billion while customer deposits increased six percent to Sh229.67 billion.

Gross non-performing loans increased by Sh1.34 billion to Sh15.7 billion in the period as its loan loss provision dropped to Sh1.64 billion.