Equity Group recorded a 15 percent increase in profit after tax of KShs.46.1 billion (approx. $349 million) in 2022, from KShs.40.1 billion in the previous year.
This has led the group to issue a 33 percent growth dividend pay-out of KShs.15.1 billion with shareholder capital buffers of KShs.182 billion.
ALSO READ: FEATURED: Equity Group ranked the world's 4th strongest banking brand
The revenue growth is driven by a 33 percent increase in non-funded income of KShs.58.3 billion and net interest income of KShs.86 billion which grew by 25 percent.
On the other hand, the total cost peaked by 39 percent to KShs.84.5 billion driven by 180 percent increase of loan loss provision of KShs.13.7 billion, up from KShs.4.9 billion, to achieve 94 percent non-performing loans coverage.
This contributed to a cost- income ratio of 48.4 percent.
The deposit base increased by 10 percent year-on-year to KShs.1.05 trillion customer deposits whereas capital and long-term debt totalling KShs.339.7 billion, which is 23.5 percent of total assets. The loan to deposit ratio was 67.2 percent.
The group's efforts to drive digital transformation is reflected in the high digital adoption with 97 percent of all transactions happening on digital platforms, on self-service customer devices and third party infrastructure, offering a strong opportunity for reduction of fixed costs and variable costs.
Pay With Equity transactions grew by 393 percent to 131.5 million transactions while the volume of business transacted grew by 281 percent to KShs.524 billion in 2022.
Internet banking transactions grew by 212 percent to 10.7million transactions while the value grew by 136 percent to KShs.311 billion.
Commenting on the performance, James Mwangi, the Equity Group Managing Director and CEO, said: "The Group's 2022 results reflect the resilience that the business has developed due to deliberate and intentional leadership and management decisions through interest capping period and Covid-19 pandemic environment."
This, he attributed to strategically positioning the business to navigate the evolving macroeconomic headwinds and turbulence in the financial and economic sectors.
Social impact
Given the challenging socio-economic environment, the Group stepped up its social impact investments inspired by the need to fulfil its commitment to promote inclusion, transformation of livelihoods, enhancing human dignity, and expanding opportunities in society with a focus on young people and women.
In the last three years, 406,621 micro, small and medium enterprises (MSMEs) received training in entrepreneurship and funding to a tune of KShs.223.1 billion and created 1,266,182 jobs through the Young Africa Works program.
Under the agricultural programs, 3.9 million farmers have been impacted to transform to agribusinesses while 215,512 small and medium sized farmers have been reached, mobilized and connected to value chains.
Over the last four years, the Equity Group Foundation (EGF) and its partners increased secondary school scholarships to 57,009 from 16,304 with over 40,000 scholars currently in school.
The Equity Leaders Program (ELP) also recorded 17,820 university scholars with 761 being global scholars and 7,482 of the scholars having received paid internships.
Outlook
While the Group's offensive strategy helped double the size of the balance sheet and increase its market share by 60 percent over the last three years of Covid-19 environment, Mwangi noted, the defensive aspects of the strategy have strongly positioned the Group to wither the prevailing challenging macroeconomic environment.
The challenges resulted from the evolution of Covid-19 pandemic into an economic crisis drawing from disruption of global supply chains and the current macroeconomic headwinds of inflation, elevated interest rates and turbulence of exchange rates and currency devaluations which have combined to create a global financial storm.
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The Group has an ambitious Africa Recovery and Resilience Plan (ARRP) that envisages to finance productivity gains in the primary sectors of agriculture and mineral resources, financing the processing, manufacturing and value addition of increased output of the productivity gains.
This is coupled with financing and promoting trade of the manufactured goods and financing SME's to populate the production value chains.
The Group also intends to finance use of technology and clean energy to leapfrog and future proof the investments so as to fill the gaps of local, national and regional supply chains.
East and Central Africa's largest financial institution is ranked as the world's 4th strongest banking brand in the 2023 Brand Finance's Brand Strength and Brand Value rankings.
