CBA posts flat half-year earnings at Sh2.36 billion

Commercial Bank of Africa (CBA) has posted a 2.87 percent jump in net profit in the half-year ended June, boosted by higher interest income.

The lender made a net profit of Sh2.36 billion in the period, compared to Sh2.29 billion in the same period last year.

Its total interest income jumped 1.85 percent to Sh9.81 billion as non-interest income dropped 1.85 percent to Sh5.2 billion.

CBA’S loan book expanded by Sh6.89 billion or 5.7 percent to Sh120.2 billion in the period from Sh113.79 billion the year before. Provisions for bad loans went down by 82.2 percent to Sh285.5 million from Sh1.61 billion last year, highlighting improving asset quality.

The bank’s volume of gross non-performing loans rose by 6.83 percent, which is the equivalent of Sh778.1 million to Sh12.16 billion during the period under review, from the Sh11.39 billion it reported last year.

CBA is awaiting approvals from regulators for its planned merger with rival NIC Group #ticker:NIC in what will set the stage for the creation of Kenya’s third-largest lender by assets.

The merged lender will count among its top owners some of Kenya’s most renowned billionaire investors and political figures, shareholder information on the two lenders has revealed.

The Kenyatta family currently holds a 24.92 percent stake in CBA while the Ndegwa family, which founded NIC Bank, has a 25 percent interest in the listed lender.

Businessman Naushad Merali will end up with a 2.9 percent equity based on his present direct ownership of a 5.6 percent stake in CBA.