Barclays profits dip slightly to Shs55bn

An increase in the expenses set aside for bad loans and customer defaults saw total expenses rise faster than revenue at Barclays Bank last year, leading to a slight decline in after-tax profits.

The bank’s financials, released in the press on Saturday, show net profits declining by 0.46% to Shs55bn from Shs55.29bn in 2016.

Revenue rose 12.7% to Shs272bn, largely due to an increase in interest income from loans and advances, which came in at Shs124.99bn compared to Shs106.16bn in 2015. Barclays however recorded a modest increase in loans to customers, which increased by 5.76% to Shs821.52bn.

On the other hand, lending to other banking institutions was up by 280% and came in at Shs60.26bn versus Shs15.85bn the previous year.

Expenses increased to Shs200.66bn from Shs171.65bn. A notable contributor to the rise was loan loss provisions which increased by 120.59% from Shs11.91bn in 2015 to Shs26.27bn last year. Operating expenses categorised as ‘other’ rose 7.47% to Shs128.38bn.

The bank’s profits before tax were Shs71.4bn compared to Shs69.75bn in 2015, an increase of 2.37%.

Its total assets rose 17.69% to Shs1,909.32bn, driven by the increase in customer loans and a 27.27% growth in available for sale investments to Shs432.5bn.

Meanwhile, customer deposits increased to Shs1,392.67bn, growing by 17.62% in 2016. This pushed up total liabilities to Shs1,514.73bn from Shs1,289.35bn.

Total shareholders equity was increased to Shs394.58bn from Shs333.03bn.