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0.25Segment: Main Investment Market
Sector: Finance And Investment
Brief Company Profile
National Bank Building Harambee Avenue, P.O. Box72866 City Square, Nairobi-00200, Kenya +254-20-2828000 (Phone)
+254-20-2311444 (Fax)
Company website:
http://www.nationalbank.co.ke/
Financial Information | Corporate History/Profile | Executives | Products/Services
Updated: Thu, August 21, 2008
Business Performance
The bank is currently involved in the modernization of its ICT through the continued installations ATMs and the introduction of internet banking. NBK also seeks to improve on its operation efficiency through cost containment and better lending practices. In addition, the bank has sought to raise its level of secured income by diverting a sizeable chunk of its funds to Government securities. However, the bank continues to be bedeviled by the enormous nonperforming loans (NPLs) portfolio, which amounted to 43.5% of total loans in June 2006 — way above the 15.8% industry average. The high non-performing loans were brought about by the reckless lending policies that occurred in the previous regime, but at present the bank is in better management hands and should therefore be able to gradually improve on its lending practices. In addition, the company has a huge accumulated revenue deficit of KES 4.00 Billion, which must be plugged gradually through realized profits. Accordingly, the firm is unlikely to issue dividends any time soon. However, should the Government make good its promise to clear a KES 2.50 Billion debt owed to NBK then the bank will be able to recover from the revenue deficit much faster and as a result dividend payment will resume in a shorter period. In deed, the company's profitability has been restored over the last two years and in the current rising interest rate regime, profitability looks set to grow. This turn of events coupled with its huge branch network has made it a potential takeover candidate by Stanbic Bank, which wants to increase its market presence through branch expansion.
2006 half-year results show a drastic improvement in the firm's operating performance with earnings rising six fold to KES 1.60 per share. The loans book grew by 7.5% to KES 25.30 Billion. However, its total capital base as a percentage of total risk weighted assets is still below the 12% statutory minimum being at 10% hence dividend payout is unlikely at least until the 12% threshold is attained.
Future Prospects
Ultimately, the speed of the bank's recovery heavily depends on the pace of its restructuring by the Government — the chief shareholder. In this regard, the bank needs to drastically reduce the huge non-performing loans portfolio so as to ensure improved operating efficiency.
Updated: Sun, January 14, 2007
• Proposed Sale of National Bank Raises a Storm (16 Nov 2009)
Even before the National Bank of Kenya is officially put on sale, a fierce behind the scenes battle for the oldest state-owned bank in Kenya is simmering. Some of the major players are angling for the vantage point to clinch what promises to be the...
• NSSF Also Opposes Offers on Disposal of Its Shares (16 Nov 2009)
The sale of the National Bank of Kenya has put the Privatisation Commission and the National Social Security Fund on a collision course. The NSSF board has totally rejected new proposals on how to dispose shares in the bank.
• NSSF Resists Pressure to Sell Sh6 Billion Shares (16 Nov 2009)
The government and the National Social Security Fund (NSSF) are embroiled in a quiet war over the Sh6 billion shares the workers pensions body holds in the National Bank of Kenya (NBK).
• BK Likely to Issue Dividends By First Half of Next Year (09 Nov 2009)
Investors in National Bank of Kenya shares might receive a dividend as early as next year after a 12-year wait as the bank inches closer to clearing its pile of losses.
• National Bank in 6 Percent Pre-Tax Growth (06 Nov 2009)
National Bank of Kenya's pre-tax profit rose six per cent in the first nine months of the year from Sh1.3 billion to Sh1.4 billion.
• NBK Joins Soya Awards Bandwagon With Fat Cheque (20 Oct 2009)
Organisers of this year's Safaricom Sports Personality of the Year Award got a shot in the arm when National Bank of Kenya came on board as partner sponsors with a Sh1 million cheque.
• Former MP Criticos Seeks Sh35 Million Refund in Land Sale (13 Oct 2009)
Former Taveta MP Basil Criticos Tuesday moved to court seeking a Sh35 million refund from the National Bank of Kenya after a land sale.
• KFA Gets Reprieve As Court Extends Orders Blocking Auction of Its Property (08 Oct 2009)
The Kenya Farmers Association has won temporary reprieve after the high court extended orders blocking the auction of its property by National Bank of Kenya over disputed outstanding debts.
• National Bank Profit Up 11 Percent (03 Aug 2009)
National Bank has reported an 11 per cent increase in its half-year pre-tax profits. The bank made Sh1 billion in the period ended June 30, 2009 compared to Sh902 million over the same period of the previous year.
• Former MP in Court Over Debt (26 Sep 2008)
A former MP who failed to repay a Sh1.8 million loan to the National Bank of Kenya was on Friday ordered to deposit Sh100,000 before he could propose to the court how he intends to settle the debt.
• Buyers to Scramble for 35 Percent NSSF Stake in National Bank (20 Aug 2008)
Who wants to buy the National Social Security Fund's 35 per cent stake in National Bank of Kenya?
• National Bank's Profit Rises to Sh403m (16 May 2008)
The National Bank of Kenya has announced a 77 per cent increase in its first quarter pre-tax profit.
• National Bank's Profit Crosses Sh1 Billion Mark (26 Mar 2008)
The National Bank's profit before tax has passed the Sh1billion mark following recovery of bad debts and an aggressive reduction in operating expenses.
• State Bail Out Stirs a Slumbering Giant (14 Dec 2007)
A year ago any banking industry analyst would have painted a bleak future for the state owned National Bank of Kenya.
• NBK in Brokerage Partnership (28 Nov 2007)
National Bank of Kenya will provide brokerage services for Standard Investment Bank for the sale of shares in Safaricom.
• NBK Clients to Trade NSE Shares in Its Branches (28 Nov 2007)
Mr. James Wangunyu
• NBK to Introduce Islamic Product (25 Nov 2007)
National Bank of Kenya is planning to launch a lending facility targeting Muslims early next year. The announcement comes just days after the bank launched a savings and current account product targeting the same clientele last week.
• National Bank Pre-Tax Profit Up By 35 Per Cent (20 Jul 2007)
National Bank of Kenya's pre-tax profit for the first six months of the year rose by 35 per cent to Sh617.1 million from Sh457.4 million last year.
• National Bank Profit Increases to Sh617m (19 Jul 2007)
National Bank of Kenya has reported a 34.9 per cent increase in pre-tax profit to Sh617 million for the half year ended June 30, a proof that the repayment of a Sh21 billion debt by the Government is bearing fruits.
• NBK Considering Share Buy Back (25 Jun 2007)
National Bank of Kenya (NBK) has announced plans to reduce its paid-up equity capital as shareholders mount pressure for dividend payments. Managing Director, Mr Reuben Marambii, said the capital reduction process would enable the bank accelerate...
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