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Tuesday, February 13, 2007

Equity join League of Billionaire Companies

Equity joins club of billionaire firms
Story by MWANIKI WAHOME Publication Date: 2/13/2007

Equity Bank posted Sh1.1 billion in its profits before tax from Sh501 million, representing a 120 per cent growth in the financial year ending December 31.
Equity Bank chairman Peter Munga (left) shares a light moment with the bank's CEO, Mr James Mwangi, at the Grand Regency hotel yesterday. Equity announced a pre-tax profit of 1.1 billion for the year ended 2006.
The bank, that registered its millionth customer recently, had its deposits nearly doubled to Sh16.3 billion from Sh9 billion realised the previous year.
The total assets portfolio topped Sh20 billion from Sh11.5 billion in the previous year.
The chief executive officer, Mr James Mwangi, attributed the massive growth in profits to the expansion of the economic activities, particularly in the rural areas.
“Overall, the positive growth in profitability was supported by improved economic fortunes but we have also significantly benefited from the robust information technology (IT) platform that has seen us open alternative delivery channels, such as internet and SMS banking,” he said.
Equity, he said, had joined the big banks accounting for 32 per cent of total accounts in the country

12 more branches

Releasing the financial results at the Grand Regency Hotel, Mr Mwangi, said the bank’s operating costs had increased to Sh2.3 billion compared to Sh1.3 billion following the opening of 12 more branches in the period under review.
Other reasons were increase in staff costs after employment of 510 more workers and marketing costs during the listing at the Nairobi Stock Exchange (NSE).
The gross loan portfolio significantly increased to Sh11.4 billion, from Sh5.9 billion registered in 2005 due to increased lending to the agriculture sector and the small and medium enterprises.
However, the level of non-performing loans relative to total loan portfolio declined to five per cent from 10 due to enhanced recovery.
Mr Mwangi said the listing at NSE had pushed the bank’s core capital to Sh2.2 billion up from Sh1.4 billion.
“The increase is expected to go up after the board announced plans to issue two bonus shares for each held to support its growth strategy,” Mr Mwangi said.
This was subject to approval by the Capital Markets Authority and the bank’s annual general meeting (AGM) to be held next month, he added.
The board also announced a dividend of Sh2 per share that will total Sh181 million, representing 40 per cent of paid up capital.
In Amsterdam, Dutch bank ABN AMRO NV said that its 2006 net profit rose 7.6 per cent after it added Antonveneta to its operations and disposed of its Bouwfonds property unit. ABN also said it would buy back $1.3 billion worth of its own shares by the end of 7, and aim for per share earnings of 2.30 euros in 2007.
Additional reports by Reuters

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