HF Group posts Kes 256.7M full-year net profit

for Tv47 Digital March 31, 2023, 10:17 AM
Group CEO Robert Kibaara (2nd left), HFC MD Peter Mugeni, Bancassurance P.O Maureen Stephyne, and CFO Sammy Kamanthi during the release of the results.
Group CEO Robert Kibaara (2nd left), HFC MD Peter Mugeni, Bancassurance P.O Maureen Stephyne, and CFO Sammy Kamanthi during the release of the results. PHOTO/COURTESY

HF Group has posted a full-year net profit of KSh256.7 million, from a loss of KSh682.7 million in December 2021. This represents a 939% growth on the back of an aggressive business transformation strategy.

The growth was fuelled by a stellar performance by the Group’s banking subsidiary, HFC, whose profit after tax grew by 560% to KSh178.2 million rising from a loss of KSh381.3 million in December, 2021.

Interest income grew by KSh347 million while Interest Expense increased marginally by 1% equivalent of KSh15million. Interest earning assets grew by KSh3.6 billion while the average yield on these assets improved year on year to 10% from 9.6% in December 2021. Deposits grew by KSH1.5 billion during the period that was characterised by steep rise in interest rates. 

“Our performance reflects the relentless focus we have put on our business transformation strategy. Our diversification to full service banking has seen the Group maintain a flat interest expense line while growing customer deposits and significantly increasing our funded and non – funded income.” said HF Group CEO, Robert Kibaara.

Despite a 13% growth in staff costs to support new business segments, the Group’s total expenses dropped by KSh472million (14%) year-on-year highlighting the success of a cost optimisation program. 

“We continue to invest in people and technology, speeding our capacity building and digital transformation in order to enhance customer experience,” he said.

Foreign exchange income rose by 182% underscoring the bank’s new focus on the SME market as the benefits of full-service banking continue to stream in.

The profit-making streak was recorded across all Group subsidiaries with the property development subsidiary revenue growing by KSh321 million supported by growth in project management fees and commissions.

The Group’s bancassurance subsidiary (HFBI) posted a 12% growth in profit before tax to reach KSh47.5 million. 

The Group CEO has exuded confidence of sustained profit making across all business units driven by revenue diversification and deepening of its full-service banking.

“As we embark on 2023, we have an optimistic outlook on our performance. Revenue diversification is expected to accelerate as the Group continues to roll out SME and Personal Banking offerings and project management initiatives, and this is expected to continue facilitating access to cheaper funding for the franchise.” Kibaara concluded while releasing the results in Nairobi.

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