Equity Group half-year profit down 24pc on high provision for defaults

Equity Group

half-year net profit has tumbled by 24.3 percent to Sh9.02 billion after the lender increased provisioning for loan defaults by nearly nine times to reflect the Covid-19 triggered economic difficulties facing borrowers.

The lender said on Tuesday that net profit for the six months to June has retreated from Sh11.92 billion posted in a similar period last year.

The fall in profit was despite net interest income growing by 16.9 percent to Sh24.6 billion as the lender’s loan book expanded by Sh70.7 billion or 22 percent to Sh391.6 billion.

Equity increased loan loss provisioning 8.7 times to Sh8.02 billion in contrast with Sh918.5 million that had been made in the preceding similar period.

Gross non-performing loans have risen by Sh16.3 billion or 55.7 percent to Sh45.55 billion, pointing to deterioration in loan book quality in a Covid-19 environment. Read more

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