BK Group nets Rwf 16.1 billion in 2020 first half

By Nicole Kamanzi M.
On 2 September 2020 at 01:48

BK Group Plc has reported that in the first six months of 2020 they made a profit of Rwf16.1 billion after paying taxes, a 10.6% growth compared to the same period last year.

The growth in the company’s interest rate on loans and advances increased by 21.5% compared to the same period last year.

The bank served over 352,000 retail customers and over 36,600 corporate clients and at the same time expanded its agency banking network to 1,951 agents as at the end of June 2020; the network processed over 1.7million transactions worth Rwf158.8 billion.

Operating income rose by 8.5 percent to Rwf64.6 billion; this was due to potential impact of Covid-19 and the significant increase in credit risk which largely affected the loan loss provisions. Non-performing loans increased to Rwf52.8 billion, while the non-Performing Loans ratio remained at 5.6 percent while the cost of risk increased to 4.6 percent from 2.7 percent at the end of 2019.

With the reduced business volumes and increased financial distress, the bank granted a grace period between 3 to 10 months to clients who sought moratorium. With the restructuring of loans, restructured facilities related to Covid-19 reached 37 percent of gross loans and advances.

BK Insurance registered a profit of Rwf1.4 billion in the second quarter of 2020 compared to Rwf1.14 billion registered in the same period last year representing a 22 percent growth in profitability (Year on year); the insurance arm profit was among other things driven by an increase in gross premium from Rwf2.4 billion in 2019 to Rwf2.7 billion in the second quarter of 2020 this is a growth of 12 percent.

At BK TecHouse, there was a growth in net sales by 6 percent year on year to Rwf515 million. Net Profit before tax stood at Rwf99 million; the group’s ‘youngest’ subsidiary BK Capital saw assets under management grow to Rwf9.2 billion as at the end of June 2020 from Rwf2.9 billion at the same time last year.

The BK Group CEO Dr. Diane Karusisi said that the second quarter was a turbulent period due to the effect of the pandemic on the economy.

“The second quarter was probably the most tumultuous period in a long time as the pandemic hurt economic activity across all sectors. We continued to deliver for our clients, employees, our communities, and shareholders beyond just business continuity. The growth registered in net loans and customer deposits shows that even in times of crisis, it is possible to pursue new opportunities,” she said.

She believes that the performance will improve in the coming months as the economy steadily picks up.

“As the Rwandan economy steadily picks up for the rest of the year, we remain hopeful to close this year with a much better performance than anticipated at the beginning of the pandemic,” she said.

Bank of Kigali, founded in 1966, is the first major bank in Rwanda with a 30.3% market share. It has 68 branches, 94 ATM units, 1,951 agents, all of which provide services to 352,996 individual customers and 36,684 companies.

BK Group Plc has reported that in the first six months of 2020 they made a profit of Rwf16.1 billion after paying taxes,