I&M Group has announced an impressive 33.3 per cent increase in profit after tax, reaching Sh3.6 billion for the first quarter ending March 2024.

This is a significant rise compared to Sh2.7 billion reported during the same period in 2023.

The robust growth has been attributed to heightened interest and operating revenues.

The lender’s total interest income surged by 52.9 per cent to Sh15.6 billion, driven by substantial growth in loans and advances, which increased by Sh11.4 billion and Sh7.2 billion, respectively.

Additionally, interest income from government securities rose from Sh2.7 billion to Sh3.3 billion, mainly due to margin expansions following a decline in holdings.

Operating income also saw a notable increase of 19.8 per cent, climbing to Sh11.5 billion.

Gul Khan, the CEO of I&M Group, credited the positive performance to the bank's strategic goals.

"We are pleased to record an impressive double-digit growth in profit in our first quarter of the year. Our focus on offering relevant financial solutions for Kenyans like free bank to M-PESA transactions to individuals and sole proprietors, strategic branch expansion and ecosystem partnerships has yielded results as demonstrated by our customer numbers and increase in deposits,” Khan said.

The bank's balance sheet also showed a solid 13 per cent growth, closing at Sh533 billion, with customer deposits expanding by 18 per cent to Sh384 billion year on year.

However, the lender's net non-performing loans stood at Sh14 billion, attributed to a challenging macro-economic environment.

I&M Group's net profit grew by 30.9 per cent to Sh3.32 billion in the first quarter of 2024, up from Sh2.54 billion in the same period last year, as net interest income surged by 37.7 per cent to Sh8.39 billion.

Despite a 9.4 per cent decline in non-interest income to Sh3.16 billion, the bank managed to offset this with the increased net interest income.

The waiver of transaction fees for mobile money transfers, introduced in mid-February last year, has played a significant role in this growth, doubling the pace of new personal accounts and expanding loan disbursements.

Operating expenses rose by 10 per cent to Sh6.64 billion, driven by a 24.2 per cent increase in staff costs to Sh1.96 billion, reflecting an expanded workforce and salary increments.

The lender opened eight new branches in Kenya mid-January this year and plans to add 12 more by the end of the year. Other operating expenses increased by 15 per cent to Sh2.2 billion.

I&M Group will distribute a dividend of Sh2.55 per share, amounting to Sh4.22 billion, for the performance year ended December 2023.

This dividend, to be paid on March 24, 2024, continues the trend of increased shareholder distributions for the third consecutive year.  

Looking ahead, I&M Group aims to double its physical branches in Kenya to 100 by the end of 2026, strengthening its position in the retail banking sector.