Home Business & Tech Bank of Kigali Makes Rwf30 billion pre-tax Profit

Bank of Kigali Makes Rwf30 billion pre-tax Profit

by Dan Ngabonziza
6:52 pm

Dr. Diane Karusisi, BK -Chief Executive Officer told journalists.The bank made a pre-tax profit of Rwf30 billion last year

Bank of Kigali Group – Rwanda’s largest bank by assets, has announced a pre-tax profit of Rwf30 billion (approx. $36million) and announced a proposed 40% dividends to its shareholders.

The bank’s profit before tax was Rwf4.3 billion impressively higher than the Rwf25.6 billion reported in 2015.

Dr. Diane Karusisi, Chief Executive Officer told journalists this afternoon that the bank’s double digit growth in 2016, “was attributed to customer loyalty and growth in its corporate, Small and Medium Enterprises loan book.”

Considering an increase in customer loyalty, the bank says its number of active banking agents grew to 1,280 from 1,043 in 2015, with its services distribution channels expanded by opening 4 new branches.

The Bank has 65 active branches across the country, with 24 branches in the capital Kigali.

BK was offered a 5-year tax holiday when it listed on the Stock Exchange six years ago, but taxes kept hiking as the holiday expired.

As of last year, the Bank’s tax holiday offer enabled it to enjoy a reduced corporation tax rate of 20% for the previous 5 years due to listing more than 40% in Rwanda Stock exchange, with its corporate income tax rate returns standing at normal 30%.

In the nine months of last year, the bank’s total assets were worth Rwf 596.4 billion registering an increase of 13.6% on annual basis. The gross loans totaled Rwf4107 billion – increasing by 26.5% in first nine months of the same year and a 35.5% on year on year .

At the time, the bank’s net loans increased by 27.6% and 35.8% on annual basis reaching Rwf400.5 billion with gross/total assets ratio standing at 68.9% by end of 30 September 2016 – increasing from 57.7%.

Also, by end of September 2016, the bank’s net income was Rwf42.9 billion indicating an increase of 26.5%, net non-income increased by 21.6% to Rwf16.0 billion by the end of September, 2016, while operating costs increased from 21.3% to 26.1% with cost/income ratio effectively managed at 44.3%.

After enjoying a super performance in a year during changes in its executive management, BK is expected to bolster shareholders confidence.

Dr. Karusisi announced, “We will suggest to the board a 40% dividend payout to shareholders.”

Meanwhile, the Bank keeps an open eye on more customers targeting to expand its growth by offering new services.

“We plan to enable our agents to attract more customers to open up BK accounts… This will be an additional service offered by the agents apart from the current deposit and withdraw services offered by them,” Karusisi said.

As a strategy for next year, Dr. Karusisi said, “The bank has a new credit rating policy that will favour businesses and individuals, with low risk profiles to benefit from low cost financing that will boost their investment and personal development.”

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