Family Bank emerges from a turbulent year to record remarkable performance

Family Bank emerges from a turbulent year to record remarkable performance

posted on March 29, 2017

Contacts

Norman Mudibo

Phone : +254 720 875 094

Nmudibo@familybank.co.ke

PRESS RELEASE

FAMILY BANK EMERGES FROM A TURBULENT YEAR TO RECORD REMARKABLE PERFORMANCE

Nairobi, Kenya, March 29th 2017 – Family Bank’s resilience amidst a fiercely turbulent period has been proven yet again. The Bank recorded a fairly reasonable performance despite expectations it would record a loss.

The bank raked in a profit before tax of 664Million – down from Ksh 2.9Billion over a similar period in 2015. A one-off cost of nearly Ksh400Million relating to the staff restructuring exercise, a slowdown in lending and branch expansion also contributed to the decline. The Bank had warned that its full year profit will fall by at least a quarter occasioned by huge costs of deposits, provision for bad loans, funding expansion and a one-off cost for the Voluntary Early Retirement scheme.

“We did take a hit on our bottom-line arising out of the turbulence we faced last year. The sustained social media attacks which led to significant withdrawals took a further toll on our profitability. However, I can confidently say that we are recovering from the reversals of the past year, thanks to the great confidence and support from our customers,” said Dr. David Thuku, the Bank’s MD.

The Bank which is the 5th largest in Kenya based on its branch network of 93 outlets is pursuing a two-prong expansion strategy – brick and mortar and a heavier push towards the digital space. “Our push is skewed towards digital platforms – mainly mobile banking under the revamped PesaPap offering,” says Dr. Thuku.

Banks are re-looking at their strategies in order to align their business models with the recent amendment to the Banking Act on capping of interest rates. Family Bank is remodeling its business anchored on efficiency with a shift towards digital banking as the next frontier for growth.

” This is part of a broader plan to pivot the business away from reliance on interest income lines,’’ says Dr. Thuku.

The Bank is implementing its biggest transformation program whose key pillars are efficient operations, improved customer service levels and having an empowered staff base able to drive growth that is geared towards the top Bank status. The Bank is fortifying its value proposition through the alternative business channels like mobile banking, online banking, agency banking, among others.

The Bank’s liquidity position has remarkably recovered from the great strain it underwent during the sustained social media attacks last year. The Bank’s resilience and strong capital position is evidenced by the growing trajectory of the shareholders’ funds and total capital adequacy ratios.

Ends

Family Bank Financial Results Press Release 29th March 2017 as at 29.3.17

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