First-quarter earnings for Family Bank is Sh732m 2023

Family Bank reported a profit of Sh732,4 million for the quarter ending in March, with earnings remaining relatively unchanged despite rising expenses.

Interest costs and other operating expenses increased by 43.8% and 16.0%, respectively, during the three-month period, causing the quarterly earnings to decline by 0.1% from Sh733.1 million.

Family Bank’s total operating income increased by 9.9 percent to Sh3 billion from Sh2.8 billion, with non-interest income increasing by 39.2 percent to Sh995.8 million due to higher forex trading income.

Family Bank paid more to retain customer deposits during the period, as its quarterly net interest income remained unchanged at Sh2 billion.

The bank’s consumer deposits increased by 3.7% to Sh92.8 billion from Sh89.4 billion during the same period of the previous year.

Family Bank’s loan loss provisions costs fell by 10.5% during the period to Sh162.5 million, despite the bank’s aggregate non-performing loans increasing by 15.6% to Sh13.3 billion from Sh11.3 billion.

Family Bank’s balance sheet grew by 7.9% in three months to Sh131.9 billion, while the lender’s loan portfolio grew by 2.9% to Sh83.8 billion.

However, the bank reduced its holdings of government securities in order to align itself with other top banks that have since refined their portfolios to increase consumer lending.

At Sh11.3 billion, the bank’s exposure to government securities decreased by 2.3%.

Rebecca Mbithi, chief executive officer of Family Bank, described the operating environment in the first quarter as challenging, but she expects the bank’s solid funding base to help it overcome the obstacles.

She stated, “The operating environment has been challenging, but the bank’s capital position and continued prudent risk management practices will allow the Group to weather the storm and continue to capitalize on market opportunities that are bankable.”

Family Bank increased its capital expenditures on modernizing its technology platforms, talent, and processes and anticipates a return within the next twelve months.

With a core capital base of Sh13.3 billion and a liquidity ratio of 36.2%, the lender remains adequately capitalized.