Equity Ngara Branch partners with Interior Ministry to plant trees at Mathari Hospital

Equity Ngara Branch partnered with the Ministry of Interior and Coordination of National Government to plant 3,300 tree seedlings at Mathari National Teaching and Referral Hospital.

The exercise was conducted with the support of the Kazi Mtaani programme and chaperoned by the Deputy County Commissioner Mathare Sub-County, Jacob Mwaura.

More than 200 youths from Mathare sub-county came out to plant trees in the public hospital that focuses on mental health matters.

“Kazi Mtaani is an intervention by the Government to take care of youth affected by the restrictions enforced during the COVID-19 pandemic, where many have lost jobs and closed their businesses. Through exercises like this one, where young people provide labour, we keep the youth busy and the environment clean. The youth will also be involved in taking care of the trees until they grow,” said Jacob Mwaura.

He added that this being the rainy season, it is a good time to plant trees, with Mathare sub-county having a target of 4 million trees for the year 2021.

Speaking during the tree planting, the Acting Deputy CEO of Mathari Hospital, Dr Laurence Nderi said the hospital is happy to partner with Equity since both institutions share a commitment to impact the communities they serve.

“Equity is a market leader in the banking sector and has a strong CSR culture. Assisting the community is one of our mandates and we are glad that Equity staff are leaving their offices to be with the community. There is a lot more we can do together,” he said.

Equity Nairobi West Region General Manager Stephen Macharia, who accompanied the staff from Ngara Branch, said the event was a significant one for the region which boasts 32 branches.

“We have a target to plant 23,600 trees per branch, but even more important is that we want this exercise to be in partnership with the community. We acknowledge the young people from Kazi Mtaani who have joined us today here at Mathari National Teaching and Referral Hospital to plant trees,” he said.

The event was organized by Equity Ngara Branch.

“Mathari National Teaching and Referral Hospital is our client and we are happy to partner with them today as we plant trees under the direction of Kenya Forest Service officials,” said, Charles Gitonga the Branch Manager

Among the trees planted were 200 indigenous trees and 100 grafted mango trees.

Patricia Kitheka, who is in charge of forestry advisory services in Nairobi County said Kenya Forest Service, values Equity’s partnership in greening the county.

“This is in line with the presidential directive to increase forest cover,” she noted.

The exercise is part of Equity’s 35 million trees planting initiative in the Group’s efforts to conserve the environment.

Through its partnership with Kenya Forest Service (KFS) in this noble initiative, the Bank has been able to receive technical and supervisory support in ensuring proper planting and maintenance of the trees.


Equity Group Defies COVID-19 Impacts and Registers 51% Balance Sheet Growth

The year 2020 was like no other.  COVID-19 struck at the beginning of the year and the East Africa region had its first case of infection in early March.

The global spread of the virus quickly became a pandemic.

To comply with the World Health Organization’s prevention protocols, restrictions put in place including limitations on movement and travel, social distancing, and constrained interactions resulted in economic slowdowns which in turn caused global supply chain disruptions due to interruptions of production, distribution, and a reduction of economic activities.

By April, the health pandemic had turned into an economic crisis with lost lives and livelihoods resulting into a dilapidating humanitarian crisis characterized by lost jobs, unemployment, lost investments, hunger, poverty, human misery, unhappiness, fear and uncertainty.

Releasing 2020 Full Year results, Equity Group Managing Director and CEO Dr. James Mwangi said, “The previous global pandemic was the Spanish Flu which occurred in 1919, a century back, and hence the world had lost its memory and had to re-learn, adapt and adjust making 2020 an exceedingly difficult and challenging year.  Our corporate purpose of ’Transforming lives, giving dignity and expanding opportunities for wealth creation’ became the guiding compass of the organization’s essence on how to navigate through the crisis and the challenging environment. Our results and performance became a human story of resilience and determination to live an ethical human purpose.”

The 2020 results reflect a purpose lived and a management team uniquely differentiated by the decisions it made.

From the onset, Equity Group management opted to safeguard and cushion the lives of staff, clients, and host communities by supporting lives and livelihoods through maintaining economic activities to keep the lights of the economies on and boosting Government efforts with Kshs 4 billion initiatives.

Interventions included;

  1. Waiving mobile charges of Kshs 1.2 billion to enhance households’ disposable incomes while at the same time sensitizing clients to adopt mobile, digital, and online banking, in compliance with health protocols of reduced mobility, minimized interactions, promoting hygiene, and maintaining social distancing.
  2. Offering opportunities for loan accommodation up to 45% of the loan book, to minimize disruption and allow re-adjustment to match new cash flows while waiving rescheduling fees of Kshs 1.2 billion.
  3. Maintaining and enhancing lending activities resulting in a 30% growth in loan book thus supporting economic activities that provided for livelihoods and keeping the lights of the economy on, while offering oxygen to new green shoots of opportunities through retooling, repurposing, reforming and adapting to new opportunities in the marketplace, capital re-allocation and new consumption patterns.
  4. Mobilizing and contributing Kshs 1.7 billion to support community efforts towards fighting the COVID-19 pandemic by procuring and providing testing kits, logistical support and PPEs for frontline health workers in public COVID-19 management health centers as well as supporting a robust mental health and psychosocial wellness program for frontline healthcare workers.
  5. Supporting 17,800 Wings to Fly and Elimu Scholars to cope with the prolonged school closure and providing them with solar powered radios and lamps with a mobile charging unit that allowed them to continue learning while providing for their life’s essentials financed by a monthly stipend with the support of our partner Mastercard Foundation.
  6. Supporting staff and clients by mobilizing Equity Afia, an Equity Group associate health franchise, to spearhead COVID-19 awareness, health education of prevention measures and coping mechanisms while maintaining job security for all staff without subjecting them to salary freezes or reductions, while accommodating more than 50% of the staff to work from home
  7. The Group uniquely differentiated itself by prioritizing purpose first, and disproportionately focusing on the social mission of the organization of ’changing lives and giving dignity while supporting opportunities for wealth creation’. In steering its economic engine, the management and the Board adopted a twin strategy of being defensive while at the same time being offensive to adjust, adapt and take advantage of emerging opportunities by:
  8. Enhancing core capital by withdrawing 2019 declared dividends amounting to Kshs 9.5 billion and raising Kshs 11 billion of Tier 2 capital.
  9. Enhancing risk management by partnering with development institutions to obtain partial credit guarantees to the credit book while enhancing provisioning levels by Kshs 26.6 billion to deal with the uncertainties and shocks.
  10. Enhancing liquidity buffers to mitigate the risk of rescheduling client loans and accommodating loan repayment moratorium’s by securing foreign direct funding amounting US $350 million and raising liquidity levels by 7 percentage points to 59%.
  11. Identified and seized opportunities of organic growth in Kenya and Uganda and an acquisition and merger opportunity in the Democratic Republic of Congo (DRC), and migrating, integrating, merging, and rebranding with our existing subsidiary in DRC.
  12. Equity Group has recognized changes in consumer behavior driven by erosion of trust, the digital switch, accelerated adoption of technologies and an upended theory of purpose first, community engagement and re-imagining business model and has taken a head start to reposition itself.
  13. Equity has significantly invested in its social brand, enhanced online banking, focused on mobile technologies, internet and artificial intelligence to drive online channel experience.

The Group has weathered the COVID-19 disruption to register a 51% growth in its balance sheet with total assets growing to Kshs 1.015 billion (One trillion and fifteen billion shillings) up from Kshs 674 billion the previous year.

The growth delivered through both organic and merger & acquisition strategies saw the group become the first financial institution to cross the trillion shillings rubicon in East and Central Africa.

The growth has been driven by a 53% increase in customer deposits which grew to Kshs 741 billion up from Kshs 483 billion, while long-term debt financing grew by 71% to Kshs 97 billion from Kshs 57 billion with shareholders’ funds growing by 24% to Kshs 139 billion up from Kshs 112 billion.

Deployment of the 51% growth of funding enabled loans to customers grow by 30% to Kshs 478 billion up from Kshs 366 billion. Cash and cash equivalents grew by 186% to Kshs 247 billion up from Kshs 86 billion. Investment in Government securities grew by 26% to Kshs 217 billion up from Kshs 172 billion.

Net interest income grew by 23% to Kshs 55 billion up from Kshs 45 billion driven by a 30% growth on customer loan book and 26% growth in investment in Government securities.

Non-funded income grew at 27% to reach Kshs 38 billion up from Kshs 30 billion to contribute 41% of the total income. Forex trading income grew by 77% to stand at Kshs 6.2 billion up from Kshs 3.5 billion.

Diaspora remittances commissions grew by 76% to Kshs 1.5 billion up from Kshs 0.9 billion. Volume of Forex trading increased by 51% to Kshs 863 billion up from Kshs 571 billion with Diaspora remittance contributing 32% of the volume of forex traded.

Total operating costs grew by 67% to Kshs 71 billion up from Kshs 42.5 billion driven by a 496% growth in gross loan provision of Kshs 26.6 billion up from Kshs 5.3 billion in the prior year, increasing the cost of risk to 6.1% up from 1.3% the previous year. The higher loan loss provisions enhanced NPL coverage to 89%.

As part of the Group’s commitment to support lives and livelihoods, keep the lights of the economies on by avoiding massive disruption of economic activities, the Group accommodated Kshs 171 billion of loans for customers whose repayment capacity was adversely impacted by Covid-19.

This represents 32% of the entire gross loan book of Kshs 530 billion. As at 31st December Kshs 40 billion of the restructured loans had resumed repayments and normalized.

A deep dive review of the entire Kshs 171 billion accommodated loans revealed doubts on the future viability and quality on Kshs 9 billion of loans promoting the downgrade of the said doubtful loans to NPL (IFRS 9 Stage 3) increasing the NPL portfolio to 11% up from 10.4% as at 30th September 2020, and 9% as at the end of the previous year and closing the year with 23% accommodated loan book equivalent to 11% of the balance sheet.

The Group’s cost income ratio improved to 48.5% from 51.1% the previous year driven by improvement in cost of funds from 2.9% to 2.8% and enhancement of yields on government securities from 10.1% to 10.7% despite realization of capital gains on the securities trading of Kshs 3 billion up from Kshs1.1billion the previous year and 117% growth of mark to market gains to Kshs 7.4 billion up from Kshs 3.4billion.

Yields on loans declined from 12.6% to 12.4% due to increased suspended interest on increased NPL book and change of loan book mix of local currency to US$ currency to 57%:43% from 64%:36% ratio in favour of the local currency as a result of acquisition and merger of BCDC in DRC and increase of 186% on cash and cash equivalent. The profit after tax contribution from the business outside Kenya grew to 28% from 18%.

To support and complement COVID-19 management and containment measures, the Group under the Equity Afia health franchise opened 22 additional clinics to reach 33 clinics that recorded 305,560 cumulative patient visits. In partnership with the Government and various donor agencies the Group cumulatively processed and disbursed Kshs 77.4 billion of social safety net cash transfers to 3,330,195 individuals.

To mark its 35 years anniversary since commencement of business, the Group planted 3.12 million trees and distributed 243,903 clean energy products.

With the development of COVID-19 vaccines and the world embracing vaccination, the Group is optimistic that the health crisis caused by COVD-19 will in time be brought under control.

The world is united to rebuild better and with the strong economic stimulus of US$1.9 trillion rolled out by the US, the global economy as projected by the World Bank and the International Monetary Fund to register over 5% GDP growth rate, we are optimistic of the opportunity for the Group to bounce back. The strong Group liquidity ratio of 59.3% and strong loan/asset ratio of 47% and loan/deposit ratio of 64.5% offers the Group an excellent opportunity to execute an offensive strategy while keeping risk under control. The Group expects the cost of risk to normalize going forward given the improving economic environment as well as the high NPL coverage of 89.4% for 2020.


Equity Foundation assures counties of quality PPEs supply

The Equity Bank Foundation has assured counties benefiting form the Personal Protective Equipment (PPEs) of sufficient supply for the next 18 months.

Addressing on Wednesday at Nakuru Level 5 hospital during the handing over of PPEs to the county government of Nakuru ,Equity Group Holdings Managing Director and CEO Dr. James Mwangi added that the Foundation is not only donating PPEs to counties but that they are of quality standard.

“We are sure of the Supply of PPEs for the next 18 months and the PPEs we are delivering are of the quality standard” said Mwangi.

Mwangi reiterating that the Foundation’s commitment towards ensuring healthy healthcare workers.

He noted that the healthcare workers are key in the war against COVID-19 pandemic.

The Equity Group Holdings Managing Director and CEO also using the opportunity to call on every Kenyan to play their duty towards  flattening  the curve.
Nakuru Governor Lee Kinyanjui: on his part commending the financial institutions that have stepped in during this COVID-19 pandemic period.
“What really counts is how really we internalize this pandemic.
In the banking sector,you have helped us restructure loans for Kenyans who are suffering.Nakuru being a home of SMEs we are grateful for the gesture” he said.
Kinyanjui noting that his administration will continue to work closely with other key partners in cushioning the residents form the harsh economic times occasioned by COVID-19.As a county we have continued to Chanel our funds towards fighting the pandemic in terms of cushioning residents.
He also called for collective responsibility in the fight against COVID-19.
“Time to show whether you are a billionaire or millionaire is now when we all need to play our part” said Kinyanjui.

Scholars Advised to Enroll for Innovative and Creative Courses for Growth

Scholars have been advised to enroll for innovative and creative courses to help solve current and future global challenges.

Nakuru Deputy Governor Dr Erick Korir said the country relies on education and training system to create a sustainable pool of highly trained human resource capital.

“This is a first and huge step towards creating a knowledge economy that is internationally competitive,” said Dr Korir, a PhD holder in Chemistry from University of KwaZulu Natal in South Africa.

Dr Korir was speaking at the end of a two-week rigorous induction workshop for the Equity Bank’s Paid Internship Programme beneficiaries at Jumuia Guest House, Nakuru on Saturday.

Some 67 scholars from the region – 14 Counties from the Rift Valley region – are part of 371 top students from the KCSE class of 2017 selected to join the programme this year across the country.

Nakuru Deputy Governor Dr Erick Korir (right) has a word with Equity Bank’s Paid Internship Programme beneficiaries at Jumuia Guest House, Nakuru on Saturday.

The group underwent training to impact skills in financial literacy, career development, teamwork, emotional intelligence, problem solving techniques among others.

The DG commended the initiative for its model, to expose the youth to personal and professional development, global opportunities, creativity and innovation and community engagement.

“Similarly, the program creates a strong network of scholars who work together across disciplines and sectors to transform their communities, their country and the world at large,” he stated.

The program admits the top performing boy and girl in K.C.S.E. exams from each county, as well as top performing Wings to Fly scholars who also scored an A.

Ms Caroline Eregai who scored an A Minus at Turkana Girls High School encouraged children in hardship areas to work hard in school to realize their goals.

“Your dreams should not be pegged on your current or past experiences. Stay focused,” she said adding that she would work to see children in Turkana get quality education.

Dr Korir said that by encouraging children to excel academically, join and be part of such programs was exposing them to global thinking.

Equity Bank’s regional manager Mr Collins Mukangu said previous beneficiaries had excelled in local and global acclaimed universities and now working for top companies.

“The internship runs for 9-18 months, the period between high school and university and the long vacations, with a scholar earning Sh40, 000 per month,” Mr Mukangu revealed.

Mr Mukangu said the country’s future depended on how well Kenyans embrace the future in terms of how the world is evolving and opening up new career opportunities.

The DG said the county was seeking interventions on various needs, “for a full benefit, we need to create employment opportunities so that as a county we are not affected by brain drain.”

He called for private-public partnerships to help further county’s development agendas.

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