Consolidated Bank of Kenya has sunk deeper into losses in the nine months to the end of September, pushing already negative capital ratios further down, its financial statements show.
The troubled state-owned lender posted a Sh301.5 million net loss for the period under review, worse than the Sh203.5 million it reported in a similar period last year.
Its core capital, which fell below the required Sh1 billion mark a year ago, nearly halved to Sh444 million shillings from Sh880 million previously. Most of the bank’s statutory ratios fell below the required minimum.
The bank, which was looking for a strategic investor to pump in more than Sh2.5 billion to plug its capital hole, was in June proposed as part of a take-over deal between KCB Group and National Bank of Kenya.
The takeover deal that could see KCB inject Sh40 billion in three struggling government-owned lenders is yet to be concluded and could face regulatory challenges before it is sealed.
Consolidated Bank’s total income fell 22 percent to Sh1.03 billion as its gross non-performing loans rose 27 percent to Sh2.33 billion, hurt by an interest rate capping law that came into effect slightly over a year ago.
On brighter note, customer deposits rose to Sh9.59 billion from Sh8.66 billion previously, which helped the lender earnings from interest on these funds to jump more than seven-fold to Sh8.47 million.
This did little to cushion the losses from mounting.