Equity Groups H1 2021 Net Earnings hit KSh 17.9 Billion

Equity Group Holdings Plc has defied the effects of COVID-19 pandemic on the economy to record a 98% growth in its profit after tax to KSh 17.9 Billion in H1, 2021 compared to KSh 9.1 Billion over the first six months of last year.

The lender attributes this sterling performance to significant growth in customer deposits, which pushed its balance sheet size to KSh 1.1 Trillion in H1, 2021, a 51% growth from KSh 746.5 Billion in H1, 2020.

” We have seen significant recoveries in all the six countries where we operate, with the market bouncing back to the pre-COVID-19 growth trajectory,” said Dr James Mwangi, Equity Group Managing Director and CEO.

He made these remarks at an investor briefing on Tuesday 17th August 2021 at Equity Centre to announce Equity Group H1 2021 financial results.

Equity Group Financial Highlights

Equity Group Net Interest Income from loans grew by 26% from KSh 24.6 Billion to KSh 31.2 Billion while Net Loans increased by 29% from KSh 391.6 Billion in H1, 2020 to KSh 504.8 Billion at the end of the first six months of this year.

Customer deposits grew by 51% to KSh 820.3 Billion while Equity Group cut its provisions for loan losses by 66% from KSh 7.7 Billion in H1 2020 to KSh 2.6 Billion in H1, 2021.

Gross loan provisions declined significantly from KSh 8 Billion in H1, 2020 to KSh 2.9 Billion in H1, 2021.

The Group also increased its investment in Government securities by 46% to KSh 315.5 Billion during the period under consideration. The level of borrowed funds also increased significantly by 51% to KSh 820.3 Billion.

” We have revised the outlook for 2021 as customers take into account the pandemic as the new normal. Kenya is already outperforming the rest of our regional subsidiaries and we expect that increased COVID-19 vaccinations will enable it to recover and bounce back even faster that the rest of our markets,” said Dr Mwangi.

He said Equity Group has now shifted 97% of its entire business from brick and mortar infrastructure to digital channels.

Figures indicate that the lender recorded 606.9 Million transactions on its digital channels and only 19.6 Million transactions via the legacy banking channels such as ATMs and Branches. In comparison, Diaspora remittances accounted for 4.9 Million transactions during H1, 2021.

Out of the KSh 171 Billion loans that were rescheduled by Equity Group due to the COVID-19 Pandemic, customers have resumed repayment of KSh 103 Billion and are expected to resume repayment on loans worth KSh 56 Billion over the next 12 months. Only KSh 4 Billion in this loan portfolio remains non-performing.

” We have seen significant recovery in Democratic Republic of Congo, its economic recovery boosted by a steep increase in global commodity prices. Uganda is also doing well with revenues from its oil fields expected to support growth while Tanzania has been improving its links to neighbouring countries and also rapidly reforming the operating environment for business to thrive,” said Dr Mwangi.

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