Family Bank posts a remarkable 49 percent growth in profits; raises ksh3billion in a rights issue

Family Bank posts a remarkable 49 percent growth in profits; raises ksh3billion in a rights issue

posted on March 27, 2015

Nairobi, Kenya, March 24th 2015 – Family Bank posted impressive profits buoyed by aggressive deposits growth; increased lending and diversification in customer and product mix which has brought the company on the investors’ radar screens.

The bank – which has just concluded a capital raising drive to shore up its core capital – has posted 49% rise in its pre-tax profit for the full year ending December 2014. The bank raked in Ksh 2.62billion – up from Ksh 1.78billion over a similar period in 2013.

The bank recorded significant jump in net interest income to Ksh 5.4billion from Ksh 4.45billion – a 21% increase and a 35% revenue growth to Ksh 9.7billion in 2013 from 7.2billion in 2012.

With the excellent performance, directors have recommended a dividend payment of Ksh0.50 per share totaling to Ksh 622.6million from Ksh 222.8million – which is nearly triple the payout in 2013, observed the bank’s Chairman Mr. Wilfred Kiboro.

Key drivers of this remarkable performance has been sustainable growth in loan book, aggressive deposit mobilization, branch expansion and increase in revenues Alternative Business Channels. The loan book grew by 36% – to Ksh37.9billion from Ksh 27.9billion.

The robust performance culture embraced by staff has also made this accomplishment possible. We have also increased significantly product and services utilization per customer through cross selling and enhanced customer experience. Our Customer numbers have grown tremendously over the period to over 1.6Milllion customers, added Mr. Kiboro. An aggressive customer growth campaign saw the bank reap huge gains pushing customer deposits by 36% to Ksh 47.2billion from 34.6billion in 2013.

The bank has achieved a five-fold increase in its profits and tripled its assets in the past 5 years – currently at nearly 62Billion.In only 7 years since conversion – the bank has rocketed into the stratosphere of the country’s banking peers – entirely on the strength of pursuing its renewed operating model..

The bank’s cash call towards end of 2014 received strong support from shareholders and institutional investors who pumped in more than Ksh 3Billion. That coupled with increased retained earnings had a 78% boost to the shareholders’ funds to Ksh 10.6Billion from Ksh 5.97billion in 2013.

Managing Director & Chief Executive Officer – Mr. Peter Munyiri attributed the performance to ongoing transformational changes and implementation of the new business operating model which is gradually positioning the bank as a one stop-shop providing products and services for all the profitable market segments.

“We remain confident of realizing premium returns to shareholders in future. We are also creating capacity for investment in areas of high growth potential with focus  on the retail mass market, SME and local corporates to give us a strong competitive position in all sectors of the economy”, added Mr. Munyiri.

In 2014, the bank opened 7 branches that included Kasarani, Kajiado, Laptrust, Bomet, Malindi, Litein, and Mwea. The bank has lined up another 10 branches this year with two having opened their doors to customers in the past two weeks – Migori and Utawala, Embakasi.