News Column

National Bank Posts Modest First Quarter Profit

May 28, 2014

Constant Munda

The new look of National Bank branch along Nkrumah road Mombasa. Photo Elkana Jacob

NATIONAL Bank reported yesterday profit after tax for the first three months of the year jumped by a modest 10.8 per cent compared to a similar period a year ago.

The state-owned mid tier lender's profits reached SH410.8 million up from Sh370.7 million in March last year, according to a financial statement filed yesterday with the Nairobi Securities Exchange where its shares are publicly traded.

The growth was powered by a significant 74.2 per cent or an equivalent of Sh20.09 billion growth in loans to stand at Sh47.2 billion as at March 31 from Sh27.09 billion previously.

The expanded loan book saw the lender's net interest earnings climb to Sh1.55 billion, representing a 20 per cent increase over Sh1.29 billion posted a year earlier.

Non-interest income mainly from transaction fees and commissions also rose to Sh854.5 million during the quarter year period, a 41.1 per cent growth.

The bank further benefitted from cheap deposits from its customers that soared by an an encouraging 19.7 per cent to Sh81.75 billion from Sh68.29 billion a year ago.

The party was however spoiled by a 30.7 per cent jump in operating costs that ended the quarter at Sh182 billion up from Sh1.39 billion.

The bank, controlled 70.55 per cent by state - 22.5 per cent directly by the Treasury and 48.05 per cent by National Social Security Fund-- said on March 26 it will lay off about one hundred employees this year as part of its a cost cutting measures.

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Source: AllAfrica

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