NCBA Group has announced its unaudited financial results for the first quarter of 2025, reporting a 3.4% year-on-year growth in Profit After Tax (PAT) to Kshs 5.5 billion, up from Kshs 5.3 billion in Q’1 2024. The moderate earnings growth came despite a contraction in the balance sheet and lower non-funded income, indicating a resilient performance anchored by strong core banking operations.
The Group’s Net Interest Income (NII) rose sharply by 20.6% to Kshs 10.0 billion, compared to Kshs 8.3 billion in the same period last year. This surge helped offset a 4.5% decline in Non-Funded Income (NFI), which dropped to Kshs 7.4 billion from Kshs 7.7 billion, potentially reflecting subdued trading activity or lower transactional volumes across its digital and branch networks. Overall, total operating income grew by 8.5% to Kshs 17.3 billion, up from Kshs 16.0 billion, outpacing the growth in expenses and supporting profitability.
Operating expenses increased by 11.3% to Kshs 10.5 billion, from Kshs 9.4 billion. The uptick was primarily driven by a 13.4% increase in staff costs, which rose to Kshs 3.7 billion, reflecting the Group’s continued investment in talent and possibly inflationary wage pressures. Additionally, loan loss provisions rose by 20.3% to Kshs 1.6 billion, signalling a more cautious credit outlook amid a challenging macroeconomic environment.
Despite the profit growth, the Group reported a notable 5.6% contraction in total assets to Kshs 656.0 billion, down from Kshs 694.9 billion in Q’1 2024. The decline was largely attributed to a 10.4% reduction in net loans, which dropped to Kshs 287.0 billion. This may suggest tighter lending standards, reduced credit demand, or strategic deleveraging. Similarly, customer deposits declined by 9.6% to Kshs 495.7 billion, from Kshs 548.1 billion, which reflects increased competition for deposits.
Profit Before Tax (PBT) rose modestly by 4.5% to Kshs 6.8 billion, compared to Kshs 6.5 billion in Q’1 2024. In line with its policy from the previous year, the Board of Directors did not recommend an interim dividend for the quarter, potentially signalling a conservative stance amid the current macro-financial climate.
