Kenya Mortgage Refinance Plc has reported a decline in profits, as a result of, among other factors, a rise in funding costs which can be attributed by the rise on interest expense as compared to interest income. This led to a decrease in net interest income to KES 927 million, or a contraction of 2.89%. The high interest rates made the costs of refinancing expensive for the lenders to afford housing loans and demand for mortgages also reduced due to high credit risks and borrowing.
Kenya Mortgage Refinance Plc Net Profit falls 3%
Revenue grew to KES 1.6 billion, recording a year-on-year growth of 6.79%, while total expenses dropped by 3.89% as compared to the previous year to KES 149M. The reduction in expenses signified the company good implemented solid cost management protocols in the period under review. The net profit before income tax of the company reduced to KES 777 million, or down by 2.69%, while profit after tax dropped by 2.69% to KES 544 million.
Kenya Mortgage Refinance Plc Assets grow double-digit growth on Loans Uptake
The company had assets worth KES 40.95 billion which had grown by 26.7% year-on-year, fueled by an increase in loans and advances valued at KES 18.8 billion, up 57.9% as compared to the previous period. The total liabilities expanded by 28.57% to KES 35.3 billion, while equity rose up to KES 5.6 billion, up16.08% as compared to the previous period, signifying growth in shareholder value.
The chart below shows the progression of Kenya Mortgage Refinance Plc profit after tax in the half year period for the past 5 years.
Also read: Mizizi Africa Projects Kenya’s Real Estate to Grow in 2021
