I&M Bank has announced impressive financial results for the first six months of 2024, reporting a significant increase in net profit. The bank’s net profit surged to Ksh 6.1 billion, a 21% rise from Ksh 5 billion during the same period last year. This robust performance underscores the bank’s continued growth and successful strategic initiatives.
Strong Income Growth
I&M Group’s substantial profit increase is attributed to a strong income growth driven by a notable rise in net interest income and fees, coupled with a reduction in loan loss provisions. Operating income for the first half of the year grew by 19%, fueled by a 35% increase in net interest income. The bank’s operating profitability also saw a substantial rise of 21% year on year, reaching Ksh 11.9 billion.
“Our performance this year highlights the effectiveness of our strategic focus on enhancing our income streams and managing our risk profile,” said Gul Khan, Chief Executive Officer of I&M Bank. “The growth in net interest income and improved loan loss provisions reflect our strong financial health and operational efficiency.”
Loan Growth and Asset Quality
The bank experienced a 5% increase in loan uptake, reaching Ksh 284 billion. This growth, combined with an improvement in asset quality, was a key contributor to the positive financial results. Bad loans decreased to Ksh 15 billion from Ksh 18.4 billion, with loan loss provisions standing at Ksh 3.5 billion. This reduction in non-performing loans is indicative of I&M Bank’s effective credit management and risk mitigation strategies.
Increase in Operating Expenses
Operating expenses, excluding loan loss provisions, rose by 16% year on year to Ksh 10.8 billion. This increase is attributed to continued investments in technology and human resources across all markets. The bank’s strategic focus on technological advancements and enhancing its workforce aims to support its growth and operational efficiency.
Customer Deposits and Market Expansion
Customer deposits showed robust growth, increasing by 18% to Ksh 419 billion from its 600,000 customers. The bank’s efforts to offer relevant financial solutions, such as free bank-to-M-PESA and Airtel Money transactions for individuals and sole proprietors, have significantly contributed to this increase. Additionally, I&M Bank’s strategic branch expansion and ecosystem partnerships have played a crucial role in boosting customer numbers and deposit balances.
“Our initiatives to provide tailored financial solutions and expand our market presence have been instrumental in driving our deposit growth and enhancing customer satisfaction,” added Khan.
Regional Contributions and Asset Growth
The bank’s regional subsidiaries have also contributed positively to its financial performance, accounting for 26% of the profit before tax, which rose to Ksh 8.7 billion from Ksh 7 billion last year. This regional diversification has supported the bank’s overall profitability and stability.
The bank closed the first half of the year with total assets rising by 12% to Ksh 564 billion. This growth in assets reflects the bank’s successful expansion and operational efficiency across its markets.
Looking Ahead
As I&M Bank moves forward, it remains committed to leveraging its strategic investments and operational strengths to sustain its growth trajectory. The bank’s focus on innovation, customer-centric solutions, and market expansion positions it well for continued success in the dynamic financial landscape.
In conclusion, I&M Bank’s impressive financial performance in the first half of 2024 demonstrates its robust operational strategy and resilience in the face of evolving market conditions. The significant rise in net profit and other key financial metrics highlights the bank’s strong position and optimistic outlook for the remainder of the year.
