Eq­uity ex­pects more staff to exit this year

The bank says it tar­gets to digi­tise most of its pro­cesses by end of the year, with daily mo­bile loan pro­cess­ing at about 37,000

The Star (Kenya) - - News Business - CON­STANT MUNDA @Mun­daCon­stant

Eq­uity Bank Group yes­ter­day said it ex­pects about 400 staff to exit the lender this year by nat­u­ral at­tri­tion, adding to the 660 who left last year.

This is in line with the trend in the in­dus­try where banks are in­creas­ingly in­vest­ing in dig­i­tal plat­forms to cut op­er­a­tion costs due to re­duced in­ter­est earn­ings.

The largest lender by cus­tomer de­posit ac­counts, at about 9.6 mil­lion, how­ever said it will con­tinue to re­cruit se­lec­tively. It will largely fo­cus on re­la­tion­ship man­agers for its ex­ist­ing branches, which are hubs for its grow­ing agents and mer­chants.

“As we digi­tise, we are con­vert- ing all our branches into SME cen­tres which re­quires staff to do re­la­tion­ship man­age­ment,” group’s man­ag­ing di­rec­tor James Mwangi told an in­vestor brief­ing in Nairobi yes­ter­day. The listed bank said it tar­gets to digi­tise most of its pro­cesses by end of the year, with daily mo­bile loan pro­cess­ing at about 37,000 via its Equi­tel plat­form.

Mwangi said about Sh30 bil­lion were dis­bursed through mo­bile plat­forms in nine months through Septem­ber, com­pared with just Sh1.5 bil­lion the same pe­riod last year.

“Once we rope as­set fi­nance, mort­gages, SMEs and cor­po­rate loans to be orig­i­nated on­line, we ex­pect the on­line ap­pli­ca­tions to be about 60,000 to 75,000 on av­er­age daily,” he said.

The bank’s net profit for the nine months rose by 16.99 per cent to Sh15.01 bil­lion com­pared to Sh12.80 bil­lion the same pe­riod last year.

“Mo­bile dig­i­tal bank­ing pro­cessed nearly 3.5 mil­lion loans to­talling Sh30 bil­lion which rep­re­sented 84 per cent of the loans granted by the bank in Kenya,” Mwangi said.

The lender mo­bilised Sh15.21 bil­lion more in de­posits to reach Sh331.30 bil­lion.

Loans rose by a mar­ginal 3.03 per cent to Sh3271.38 bil­lion, while net in­ter­est in­come in­creased 26.37 per cent to Sh2.35 bil­lion. In­vest­ment in gov­ern­ment se­cu­ri­ties rose 80.78 per cent to Sh93.1 bil­lion.

“Mar­ket have re­al­lo­cated re­sources based on risk-re­turn trade-offs. The per­son whop will feel the pain is the con­sumer,” Mwangi said.”Each bank is be­ing af­fected dif­fer­ently and sep­a­rately based on the struc­ture of the bal­ance sheet,” Mwangi said.

/MONICAH MWANGI

Eq­uity Bank CEO James Mwangi

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