Family Bank has reported a 17.1% increase in profit after tax for the first half of 2024, reaching Sh1.7 billion, up from Sh1.4 billion during the same period in 2023. This growth in profitability was primarily driven by higher revenues from investments in government securities and an increase in non-interest income.
The bank’s overall performance was supported by a 7.9% rise in loans and advances, which climbed to Sh91.4 billion, along with an 18.1% growth in customer deposits, now totaling Sh119.1 billion. Additionally, the total assets of Family Bank increased by 19.2% to Sh158.3 billion, up from Sh132.8 billion in June 2023.
With credit demand from customers remaining relatively low due to current macroeconomic conditions, the bank strategically invested available liquidity in government securities. This move led to a 69% increase in investments in government securities, growing from Sh24.8 billion to Sh41.9 billion.
Family Bank CEO Nancy Njau highlighted that the focus in the first half of the year was on prudent financial management and strengthening the bank’s liquidity position. “We continue to prioritize building scalable infrastructure to support the significant balance sheet growth we have experienced over the last few years,” Njau stated.
Net interest income grew by 12.7% to Sh5 billion during the period. Following this performance, the bank raised its earnings per share to Sh1.27, compared to Sh1.10 in the first half of 2023.
Interest income rose by 26.1%, supported by growth in the loan book and increased investments in government securities. However, this growth was offset by a 46% increase in interest expenses due to the higher cost of funding experienced in the first half of 2024.
Family Bank’s strategy of income diversification also paid off, with non-funded income rising by 20% to Sh2.3 billion, driven by fees, commissions, trade finance, and gains from securities trading. However, operating expenses grew by 15% to Sh4.9 billion due to continued investments in technology, human resources, and digital transformation.
Despite the overall positive financial performance, non-performing loans increased slightly from Sh13.6 billion in 2023 to Sh14.07 billion in the first six months of 2024.