(Last Updated On: July 19, 2014)
Kenyan mortgage lender Housing Finance announced an 18 percent growth in pre-tax profit for the first six months of the 2014 financial year. The profit had grown from sh574.12 million to sh677.77 million. Operating income was up 20 percent from sh1.53 billion to sh1.84 billion. Operating expenses rose further from sh956.55 million to sh1.1 billion. Customer deposits were also up 7 percent from sh25.84 billion to sh27.66 billion. The net loans and advances grew from sh32.47 billion to sh38.8 billion hence registering a 9 percent growth.
The bank’s borrowed funds grew 24 percent from sh12 billion to sh14.96 billion while total interest income grew 9 percent from sh2.77 billion to sh2.91 billion. The bad news is that gross non-performing loans went up by a massive 31 percent from sh2.94 billion to sh3.87 billion.
Housing Finance’s future plans are to establish a non trading holding company which will give the company chance to get new business line so as to reduce reliance on interest income. It wants to partner with Britam and try to issue a joint Real Estate Investment Trust (Reits). Britam also plans to acquire a further 24.76 percent of Housing Finance and this will push its total ownership to around 46%.