KCB's earnings pressured by higher operating expenses

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KCB’s profit after tax remained relatively flat with a marginal decline of 1% according to the bank’s financial statement for the period ending December 2024.

KCB Bank Uganda, a subsidiary to Kenya’s KCB Group, reported that its net profits dropped 1% to sh29.9% from sh30b.

While income was up, a 36% increase in total expenses to sh200b affected the bank’s profitability margins for the period. For instance, the report shows higher interest expenses on deposits, which rose by 82% to sh62.5b.

“The bank increased income generated by 45% to sh241b. In 2024, we continued to enhance our customer offerings, particularly through digital solutions and tailored propositions for women, youth and small-medium enterprises,” Edgar Byamah, KCB managing director, said in a statement.

Customer deposits, a key indicator of trust, surged by 29% during the period from sh963b to sh1.2 trillion.

The bank’s loans and advances grew by 18% from sh762.5b in 2023 to sh903.5b in 2024.

KCB increased its investments in government securities, with holdings surging by 116% from sh207.1b to about sh447.2b.

The bank’s total assets expanded by 30% to sh1.7 trillion, up from sh1.3 trillion. The growth was primarily driven by increases in both loans and advances and government securities.