Despite these challenges, EGH achieved a 6% growth in its balance sheet, surpassing the 4% inflation rate, bringing total assets to Kshs 1.75 trillion (about Rwf18 trillion). The Group's regional subsidiaries played a significant role, contributing nearly half of the total assets.
The Group's deposit franchise grew by 11% year-on-year to Kshs 1.3 trillion (over Rwf13 trillion), driven by an expanding customer base now totaling 20.7 million. This increase in deposits has strengthened the Group's liquidity, with cash and cash equivalents up by 55% to Kshs 341 billion (around Rwf3.5 trillion), and investment securities reaching Kshs 459 billion (approximately Rwf 4.7 trillion). The Group's liquidity position remains robust at 57%.
Commenting on the development; Dr. James Mwangi, Managing Director and CEO of Equity Group Holdings, expressed confidence in the Group's future saying, "We are optimistic that the strong liquidity of the Group has positioned us to effectively support our customers as the economy starts showing signs of improvement in the key markets we operate in."
He also highlighted the Group's strategic decision to reduce leverage by Kshs 75 billion (around Rwf770 billion) of expensive borrowings, further strengthening its financial position.
Among others, shareholders' funds saw a 13% increase to Kshs 220 billion, boosting the Group's capacity to support private sector initiatives like the Africa Resilience and Recovery Plan (ARRP). Interest income rose by 22% to Kshs 84.8 billion (around Rwf870 billion), despite challenges from inflation and interest rate fluctuations.
EGH's diversification strategy continues to yield results, with its subsidiaries accounting for 47% of total loans and contributing 51% of the profit after tax. The Group's operations in the Democratic Republic of Congo (DRC) and Rwanda have gained momentum, while the contribution from Kenya's banking subsidiary slightly decreased.
The Group's prudent management of non-performing loans (NPLs) has resulted in a coverage ratio of 70%, with an NPL ratio of 12.9%, lower than the industry average.
However, loan loss provisions increased by 35% as the Group remained cautious in light of global economic uncertainties.
Equity Group has expanded its insurance offerings, recently acquiring a general insurance license to complement its life assurance services. The Group now provides a wide range of financial services, including life, health, and wealth protection, and has issued over 12 million life policies.
The Group is also embracing technology, with 84% of all transactions now occurring through digital channels, reflecting its commitment to enhancing customer experience.
In addition to its financial successes, Equity Group is leading in climate action and sustainability. The Group has planted 29.5 million trees and provided significant climate finance, demonstrating its dedication to environmental stewardship.
Through its Equity Leaders Program (ELP), the Group continues to invest in education, recently awarding scholarships to 113 students from Kenya, Rwanda, Uganda, and DRC, further contributing to the development of future leaders.
As Equity Group Holdings Plc navigates the complexities of the global economic landscape, it remains committed to delivering value to its shareholders, customers, and communities, positioning itself for continued success in a challenging environment.
IGIHE
Source : https://en.igihe.com/business/article/equity-group-posts-over-rwf300-billion-half-year-profit
