I&M Group share rallied 66.3 percent on the Nairobi bourse on Wednesday, coinciding with the day the lender announced that its six-month net profit for the period ended June 2024 grew.
Nairobi Securities Exchange (NSE) data showed the banking group’s share price rallied to Sh34.25 on Wednesday from Tuesday’s Sh20.60, closing the day as the top gainer on the bourse. It even touched a high of Sh35 during the day’s trading session.
The share appreciation added Sh22.57 billion to the valuation of the company, closing the day with a market capitalisation of Sh56.64 billion.
The rally, one of the largest in a single day, came amid the half-year results showing that the lender’s net profit rose by 17.4 percent to Sh5.6 billion.
The rise in earnings was helped by increased income from lending to customers in a period of high interest rates in the economy.
The tier one lender reported a 35.2 percent jump in net interest income in the period to Sh16.5 billion. I&M’s Kenyan unit drove the growth in interest income, raising its net revenue from lending by 37 percent to Sh11.2 billion.
The lender, as a result of higher interest rates, also saw an increase in the cost of funds where interest paid on customer deposits rose by 65 percent to Sh12.03 billion.
On the cost side, operating expenses rose by 14 percent to Sh14.3 billion after staff costs went up by a fifth to Sh4.18 billion, reflecting the ongoing expansion drive that saw the bank open eight new branches in January, with a plan to add 12 more before the end of2024.
Meanwhile, the bank’s non-funded income declined by 11 percent to Sh6.16 billion, mainly on account of a 38 percent reduction in income from forex trading to Sh1.82 billion as the shilling strengthened against the dollar.
