HF Group has posted a full-year net profit of Sh256.7million, from a loss of Sh682.7 million in December 2021.
This represents a 138 percent growth on the back of an aggressive business transformation strategy.
The growth was fueled by a stellar performance by the Group’s banking subsidiary, HFC, whose profit after tax grew by 147 percent to Sh178.2million rising from a loss of Sh381.3million in December 2021.
Interest income grew by Sh347 million while Interest Expense increased marginally by 1 percent equivalent of Sh15million.
Interest earning assets grew by Sh3.6 billion while the average yield on these assets improved year on year to percent from 9.6percent in December 2021.
Deposits grew by Sh1.5 billion during the period that was characterized by steep rise in interest rates.
“Our performance reflects the relentless focus we have put on our business transformation strategy. Our diversification to full service banking has seen the Group maintain a flat interest expense line while growing customer deposits and significantly increasing our funded and non – funded income.” said HF Group CEO, Robert Kibaara.
Despite a 13percent growth in staff costs to support new business segments, the Group’s total expenses dropped by Sh472million (14 percent) year-on-year highlighting the success of a cost optimization program.
“We continue to invest in people and technology, speeding our capacity building and digital transformation in order to enhance customer experience.” he said.
Foreign exchange income rose by 182 percent underscoring the bank’s new focus on the SME market as the benefits of full-service banking continue to stream in.
The profit-making streak was recorded across all Group subsidiaries with the property development subsidiary revenue growing by Sh21million supported by growth in project management fees and commissions.
The Group’s banc assurance subsidiary (HFBI) posted a 12 percent growth in profit before tax to reach Sh47.5 million.
The Group CEO has exuded confidence of sustained profit making across all business units driven by revenue diversification and deepening of its full-service banking.
“As we embark on 2023, we have an optimistic outlook on our performance. Revenue diversification is expected to accelerate as the Group continues to roll out SME and Personal Banking offerings and project management initiatives, and this is expected to continue facilitating access to cheaper funding for the franchise.” Kibaara concluded while releasing the results in Nairobi.