BK posts Rwf.4.5b net profit for nine months

The Bank of Kigali (BK) has shown resilience to the current global economic downturn by registering Rwf4.5b in net profit in nine months of 2001 compared to Rwf4.2b registered in whole of 2007. The bank’s financial statement for the quarter ended September 30, 2009 released to the press on Thursday shows that net interest income increased by 24 percent compared to the same period last year. Henry Gaperi, the Vice Chairman Board of Directors of the bank attributed the gain to continuous improvement in customer service, product innovation and expansion in the branch network. “We are benefiting from increased customer loyalty because the bank has continued lending business as usual during the crisis,” Gaperi said, referring to liquidity crunch experienced by the banking sector at the beginning of the year. The situation forced local commercial banks to increase their interest rates. As a result of the liquidity crunch, interest rates rose to 16 percent from six percent in April last year. However according to Gaperi, BK maintained its interest rates and continued to issue new credit to the economy. Within the nine months, the bank’s net loans are at Rwf69 b compared to Rwf72b issued for 12 months last year. “It sent a very significant message that we are here for clients and working together even when the economy is not doing well. The fruits are beginning to show when you care for your client, the feeling is mutual they also care for you,” he said, adding that this has had a positive effect on the bank’s deposits. The bank’s total deposits in the period under review grew by 17 percent to Rwf117billion compared to Rwf1002 billion collected in 2008. The bank’s ability to recover loans also had a hand in increasing its profitability. Non-performing loans, which reflect loans in default or close to being in default, are now at 11 percent, a significant reduction from 23 percent registered in 2007.By strengthening their risk management department, a process that begun last year Gaperi said it has also enabled the bank to be more profitable. “The fruits of risk management are reflected in the performance of the bank - if you do not manage risks, definitely Non-performing loans and profitability will show that you are not doing well,” he said. Despite the difficult economic environment, total assets of the bank grew by 20 percent to Rwf145b compared to Rwf.121b accumulated for the whole year in 2008. “We expect to surpass the 2008 profit of Rwf5.6b,” Gaperi said. Ends

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BK posts Rwf.4.5b net profit for nine months