Sidian Bank records Sh114 million net profit in Q1 2021

By People Reporter
Monday, May 24th, 2021 00:00 | 2 mins read
Chege Thumbi.

Sidian Bank has recorded a net profit of Sh114 million for the period ended March 31, 2021 compared to a net loss of Sh7 million during the same period last year.

The SME-focused bank attributed the improved profitability to increased lending in the period which grew interest income on loans as well as lending fees.

Transactional and channels business also increased in the period enhancing the profitability.

Chege Thumbi, the bank’s CEO said the performance confirmed that the institution's growth is on an upward trajectory.

“We are especially grateful to our customers for supporting us as we continue offering them custom made solutions to better their tomorrow. We are committed to supporting SMEs in the country to maximise their potential,” he said in a statement.

According to the financial results, loan impairment provisions booked in the period under review were lower by 58 per cent due to the improved loan book quality and loan collections.

The impact of the increased incomes was, however, countered by higher interest expense on customer deposits from customer deposits growth and increased money market borrowings.

The bank’s balance sheet largely remained the same at Sh33.4 billion as at March 31, 2021 compared to Sh33.5 billion as at December 31, 2020 with the bank optimising the balance sheet to earn higher incomes than last year with the same size of balance sheet.

In the quarter, net loans and advances increased by 8 per cent supported by the high liquidity and in line with the bank’s strategy to support SMEs growth.

Customer deposits increased by 1 per cent attributed to continued deposits mobilisation and customer acquisition across the bank’s 42 branches as well as increased transactional business from the bank’s customers.

Trade Finance continues to be the flagship product of the bank, with more SME customers using the bank’s online bid bond platform, Sidian Credible. This solution embraces the bank’s customers and potential customers.

 Equally, the bank said it has innovated robust digital solutions to provide its customers alternative banking channels which has contributed to the growth of non-funded income.

Further, bancassurance income grew in the period attributed to higher insurance transaction volumes.