NBK Managing Director George Odhiambo, speaking during the release of FY 2024 results
The National Bank of Kenya (NBK) has announced a remarkable financial turnaround, reporting a profit after tax of KShs. 1.06 billion in the Financial Year 2024. This marks a significant recovery from a loss of KShs. 3.3 billion recorded in the same period last year, a feat attributed to improved efficiency, digital transformation, and strategic cost-cutting measures.
NBK’s resurgence was primarily driven by balance sheet optimization and advancements in digital banking, which have played a pivotal role in enhancing customer experience and operational efficiencies. The bank successfully implemented a new core banking system and upgraded its digital payments platform, enabling faster transactions and improved service delivery.
NBK Managing Director George Odhiambo expressed confidence in the bank’s trajectory, stating. “The year 2024 has seen the Bank bounce back to profitability despite the rough macroeconomic environment that we encountered. This is highly attributed to the improved efficiency in our systems, diversifying revenue streams, and continuous improvement in customer service and experience. Looking ahead, we have set our sights on strengthening our relationship with our existing customer base and also enhancing product and service delivery to meet their ever-evolving needs.”
The bank’s operating income grew by 12 percent to KShs. 12.65 billion, with non-funded income contributing 23 percent of the total revenue. Net interest income saw a robust 24 percent increase from the previous year, rising to KShs. 9.8 billion from KShs. 7.9 billion in 2023. However, interest expenses also grew by 18 percent to KShs. 6.4 billion, reflecting a high-interest rate environment and increased borrowing costs.
On the cost side, NBK successfully reduced operating expenses by 22 percent, bringing them down to KShs. 9.1 billion from KShs. 11.7 billion in 2023. This was largely attributed to one-off expenses incurred in the previous year and the bank’s aggressive cost-cutting initiatives.
Additionally, the credit impairment charge was reduced by 21 percent, underscoring the bank’s improved risk management strategies in a challenging economic climate.
Despite the profitability, NBK faced a decline in customer deposits, which fell to KShs. 98 billion from KShs. 118 billion in 2023. To counterbalance this, the bank increased its borrowings to KShs. 23 billion, up from KShs. 15 billion in the previous year. Meanwhile, net loans and advances to customers declined slightly from KShs. 79 billion to KShs. 75 billion, reflecting a cautious lending approach amid economic uncertainties.
Looking ahead, NBK remains committed to leveraging technology and operational efficiency to maintain its growth momentum. The bank plans to invest in innovative financial solutions and sustainability-driven initiatives that align with its long-term vision for prosperity.
With a strong focus on customer-centric service delivery, NBK aims to strengthen its relationships with existing customers while enhancing its product and service offerings to meet evolving market demands.
As Kenya’s banking sector navigates a volatile economic landscape, NBK’s return to profitability signals a positive shift, reaffirming its position as a resilient financial institution ready to capitalize on emerging opportunities.