Nairobi, Kenya, March 26th 2014 – Family Bank has more than doubled its pre-tax profit for 2013 – an impressive 108% growth to Ksh 1.78billion compared to Ksh 868million realized the previous year – the best ever since its conversion to a bank six years ago.
The bank’s performance was buoyed by significant jump in net interest income to Ksh 4.45billion from Ksh 3.29billion – a 35% increase. The profits also rode on a 33% revenue growth to Ksh 6.3billion in 2013 from 4.73billion in 2012.The outcome enabled the bank’s directors to recommend a dividend payment of Ksh0.40 per share totaling to Ksh 222.8million from Ksh 111.3million – which is more than double the payout in 2012.
The Chairman – Mr. Wilfred Kiboro attributed the impressive results to the decrease in interest expense as a result of capital injection by the shareholders and intensified debt collection efforts supported by tight and improved credit administration system.
“The rapid growth is attributed to the shareholders funding through the rights issue at the beginning of last year which resulted in significant decrease in interest expense, the retained earnings and the very strong support from our customers, our strategic partners and institutional investors that saw our deposits grow from Ksh 24.6billion to Ksh34.6billion and our loan book from 17.9billion to Ksh 27.9billion.
He observed that 2013 had been a good year with impressive performance despite the very challenging and dynamic operating environment. Based on the growth trajectory achieved, he added – the bank’s ambitious strategy of becoming a tier one bank in the next three years was within reach.
Managing Director & Chief Executive Officer – Mr. Peter Munyiri said the good performance had leveraged on the successful adoption of the universal banking model which aims at gradually positioning the bank as a one stop-shop providing retail and consumer products, SME, agribusiness, corporate banking and Trade Finance, Insurance products.
“This sustainable performance has been achieved in tandem with a well planned expansion of our business footprint ,product rollout, diversification of the talent pool, investment in Information and communications technology’’, said Mr. Munyiri.
The aggressive customer growth campaign which also targeted institutional and public sectors saw the bank reap huge gains pushing its customer deposits by 41% to Ksh 34.6billion from 24.6billion in 2012. Shareholders’ funds increased to Ksh6 billion from Ksh4.9billion – a 23% surge mainly due to increase in retained earnings.
“We remain confident of realizing premium returns to shareholders in future as we position our business to optimize on our financial supermarket business model. The focus on the retail mass market and SME sector will give us a strong competitive position in all sectors of the economy”, added Mr. Munyiri.
Buoyed by the impressive results, the bank’s expansion gear is engaged with 12 new branches lined up for opening. Already 3 new branches have been opened in Kasarani, Kajiado and Laptrust. The bank is also seeking to leverage on the devolved system to romp in more customers. The devolution path remains a key driver to the bank’s growth strategy.
“We are keen to expand outreach by growing the service channels in strategic areas with focus on the county government as a strategy to increase shareholders return. We rolled out three additional branches to our network in the year 2013 and another twelve being progressed to expand our foot print to reach and serve more customers. Our expansion is in line with the county banking roadmap aimed at optimizing the devolved governance structure. We are strategically expanding into counties we do not have a presence’’, said Mr. Munyiri.
Notes to Editors
About Family Bank
Family Bank converted into a fully-fledged bank in May 2007. It started as a building society under the name Family Finance Building Society in October 1984 in Kenya and commenced operations in the early 1985. From only one branch in 1985, Family Bank has grown over time and currently enjoys a network of over 73 branches countrywide. Family Bank was the first bank in Kenya to introduce paperless banking through smart card technology that enables customers to transact without having to fill in deposit or withdrawal slips