Absa Bank net earnings grow 12pc as lender declares Sh8.42bn dividend
Absa Bank Kenya's profits rose 12 per cent to Sh16.4bn in 2023.
Absa Bank Kenya recorded a 12 per cent increase in net earnings in FY 2023 and raked in Sh16.4 billion, results it has attributed to increased funding in key sectors driving Kenya's economy.
In the period, customer loans and advances grew to Sh336 billion, an 18 per cent increase from a year before, while revenues also surged by 19 per cent to Sh54.6 billion, driven by the expansion of customer assets and the growth of bancassurance, asset management, and digital finance business lines.
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Despite facing a challenging macroeconomic environment, the bank saw a 24 per cent increase in interest income to Sh40 billion, while non-funded income grew 6 per cent to Sh14.5 billion.
The improved performance has led the bank to announce a total dividend payout of Sh7.3 million for the period, equivalent to Sh1.35 per ordinary share. Adding the interim dividend of Sh0.20 per share from October 2023, the total dividend for the year rises to Sh8.42 billion, a Sh14.8 increase from FY2022.
"This impressive performance truly reflects the growth and resilience of our customers, who have continued to give us a chance to contribute to their growth story as their financial partner,” Absa Kenya Managing Director Abdi Mohamed said while announcing the results on Monday.
“It is also a demonstration that our strategy is effective in creating value for all our stakeholders while delivering long-term growth in a dynamic operating environment. With 2023 being the first year of implementation of our five-year strategy, this performance gives us a strong launch pad from which we will execute our set priorities.”
The lender's assets during the period also increased to Sh520 billion from Sh43 billion last year.
Absa Kenya's statutory operating expenses also increased by 16 per cent, driven by investments in transformational initiatives and human development.
The jump in statutory operating expenses translated to an improved cost-to-income ratio of 39.7 per cent in the period.
“Absa is well positioned for growth. With our robust balance sheet and a strong capital position, we will continue to invest in relevant initiatives that empower our customers and stakeholders to pursue and achieve their aspirations while adeptly navigating external challenges,” said Abdi.
“We are confident in our ability to accelerate growth momentum and sustainably create value for all our stakeholders. We will continue to diligently execute our strategy, aiming to position Absa as a modern and innovative consumer financial services provider, a leading partner for small and medium businesses, and a powerhouse in corporate and investment banking.”
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