CONSOLIDATED BANK LIMITED STATEMENT ON FINANCIAL PERFORMANCE FOR THE QUARTER ENDED JUNE 2016
Consolidated Bank released its first half 2016 financial results on 29th August 2016, recording growth in net advances of 4 per cent to Kshs 9.11 billion in June 2016 compared with Kshs 8.80 billion as at 30 June 2015. The non-funded income increased by 99 per cent to Kshs 389 million from Kshs 196 million the same period last year due to increase in write backs from recovery of nonperforming loans to Kshs 125 million from Kshs 16 million the same period last year.
Customer deposits declined by 4 per cent during the period due to tight liquidity leading to increased cost of interest payments. This led the bank to record a pre-tax loss of Kshs 63 million in the period ending 30 June 2016.
Interest income increased by 4 per cent, although interest expense increased by 23 per cent, due to the high cost of deposits. This reflects the difficult operating environment for the banking sector over the last six months. The Bank also managed to reduce its overall bad debt by 44 per cent in 12 months, attributed to the aggressive debt recovery efforts.
Net Impairment provisions for bad loans increased to Kshs 137 million from a write back of Kshs 37 million against a backdrop of an aggressive provisioning model adopted by the Bank to ensure compliance with the Central Bank of Kenya’s Prudential Guidelines.