Barclays Bank of Kenya Plc (NSE: BBK) 3Q18 Earnings Note
Barclays Bank of Kenya Plc (NSE: BBK) announced a 2.0% y/y growth 3Q18 profit after tax (PAT) to KES 5.4Bn, in line with our expected KES 5.5Bn. Net interest income (NII) grew 2.1% y/y while non-interest revenue (NIR) was up 14.0% y/y. Unlike other banks that have announced 3Q18 results the bank increased loan loss charges, by 21.3% y/y during 3Q18 following a 22.3% y/y increase in non-performing loans (NPLs) to settle at a record high NPL ratio of 7.7% from 7.2% in FY17 and against a 3-year average of 5.4%. Against 3Q18 results, we maintain a HOLD recommendation on BBK with a target price of KES 10.35.
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