NIC Profits marginally drops on account of ongoing merger with CBAAugust 22, 2019
NAIROBI, Kenya, Aug 22 – NIC Group has posted Sh1.9 billion in profit after tax for the first six months to June 2019, marking a 4.2 drop from the Sh1.99 billion it made in a similar period last year.
The bank, which is in the process of merging with Commercial Bank of Africa, says the performance was in part a consequence of the ongoing merger, which has cost the bank Sh255 million in integration, advisory and legal expenses.
The reduction in profits has also been on account of increased impairments in its Tanzanian subsidiary, NIC Bank Tanzania. The Tanzanian subsidiary recorded Sh348 million in losses.
Customer deposits however increased by 4 percent to Sh152.3 Billion, while the net loan book grew by 3 percent to Sh118.5 billion.
Non-interest income was up 24 percent driven by an increase in service and transaction fees, while net Interest registered an 8 percent growth to Sh5.5 Billion from Sh5.1 Billion due to growth in investment in customer loans and investment in Government securities.
The company’s Board has approved an interim dividend for the year of Sh0.25 per ordinary share on the paid-up capital of Sh3.52 billion.
On the ongoing merger, Group Managing Director John Gachora says the banks have received the required approvals from the various regulatory bodies in the markets in which the banks operate.
“We are confident that when the new bank opens its doors we will not only meet, but exceed our customers’ expectations,” said Gachora.