Mortgage lender Housing Finance has put on hold plans to raise debt through a bond "in the short term", it announced yesterday, saying interest rates are still high.
The lender, which grew its half-year net profit by nearly a fifth for the period ended
"... the firm does not plan to market its Sh20 billion bond issue in the short term as the debt market is still expensive. Despite the successful Eurobond, the 90-day Treasury bill is trading at a high of 11 per cent," managing director
The NSE-listed lender will instead set up a non-trading holding company that will "launch new lines of businesses" to cut reliance on interest income. It will rebrand before year-end.
HF's recently revived house building subsidiary and a new venture into bancassurance steered its after-tax profit for the six months to Sh474.44 million from Sh397.12 million in a comparable period last year, a 19.5 per cent growth.
The mid-tier lender now looks headed to cross the billion-shilling mark in full year net profit for the first time despite net interest income dipping by 2.9 per cent to Sh1.34 billion in the half-year period from Sh1.38 billion a year ago.
HF, which controlled a market share of 1.46 per cent in banking sector as at
The firm's loan book grew to Sh38.81 billion in the period compared to Sh32.48 billion in a similar period in 2013. However, gross non-performing loans jumped by 31.6 per cent to Sh3.87 billion from Sh2.94 billion, for which it blamed the "ongoing reforms at the lands office".
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