Family Bank, a leading lender based in Kenya, has bounced back to profitability, booking a Ksh35.9 million ($354,000) net profit in the first three months of 2018. The lender’s quarter one (Q1) 2018 profit position has been described as a remarkable turnaround from the same period last year when the lender registered a loss of Ksh259.5 million ($2.56 million).
The bank stated that the improvement was due to steady growth in customer deposits and non-interest income, coupled with cost containment and improved operational efficiency.
The lender recorded a 5.29% growth in customer deposits closing the quarter at Ksh46.9 billion while it maintained an even stronger liquidity position of 32.4% compared to 26.5% recorded during a similar period in 2017.
The Bank managed its operating costs downwards by 14.1% and maintained a strong capital position.
“We are now seeing the results of streamlining our business operations and cost containment as well as our continued investment in technology-based financial solutions that offer our customers convenience and relevance,” said Family Bank Managing Director and Chief Executive Officer Dr. David Thuku.
“We are well aligned with our customers and this gives us the confidence that our profitability will maintain a positive trajectory,” he added.
The Bank’s net interest income was marginally down by 0.84% reflecting the impact of a disputed move by Kenya’s government to put a limit on the number of interest banks can charge their borrowers.
Family Bank also reported that during the period under review, staff costs were significantly down by 15.7%.
The lender noted that a tough macroeconomic environment saw non-performing loans and advances increase by 36.35% in Q1 of 2018 compared to same period under review in 2017.