Equity Group Holdings Plc continues to deliver solid financial results, underpinned by the Group’s strategic focus on diversification, innovation, and regional expansion. With strong liquidity, capital buffers, and robust regional businesses, the Group is poised to maintain its leadership position in the region and continue driving sustainable growth.
While releasing the full year 2024 results, Dr. James Mwangi, Equity Group Holdings Plc Managing Director and CEO, noted that they are proud of the resilience demonstrated by the Group amidst a challenging global economic landscape. “Our financial strength gives us the flexibility to seize opportunities as the regional economy presents diversified levers for growth,” he added. “The Group’s liquidity and capital position remain strong, positioning us to better support our customers in the years ahead.”
As per the FY 2024, Equity Group Holdings Plc achieved a Profit After Tax (PAT) of Ksh48.8 billion, reinforcing the continued success of the Group’s diversified business model and prudent financial management. The Group’s Profit Before Tax (PBT) grew by 17% to Ksh60.7 billion, while Earnings Per Share (EPS) rose by 11% to Ksh12.3, signifying the Group’s robust financial performance.
The Group’s total deposits grew to reach Ksh1.4 trillion with the customer base growing to 21.6 million, showcasing the scale and reach of the deposit franchise.
The Group’s liquidity remains strong, with cash and cash equivalents rising by 19% to Ksh345 billion, while investment securities grew to Ksh512 billion, contributing to an overall liquidity ratio of 57%. This positions them to effectively underpin the Group’s Africa Recovery and Resilience Plan (ARRP), a private sector-led development plan championed by Equity to catalyze, capacitate, connect, and finance enterprises and households across Africa.
Beyond providing financial and technological tools, ARRP empowers individuals, businesses, and communities through a clear framework for development, by building capabilities and mitigating risks, enabling them to leverage these tools effectively and efficiently to achieve their social, environmental, and economic ambitions.
The ARRP aspires to drive long-term transformation across Africa, relying on the support and active participation of diverse stakeholders. Strategic partnerships with Development Finance Institutions (DFIs), global implementation partners, and social institutions have been instrumental in delivering a wide range of social and commercial outcomes with lasting, sustainable results. As part of these efforts, the Group has also partnered with the African Development Bank (AfDB), Microsoft, and Mastercard Corporation to digitize 10 million farming customers under the Community Pass initiative for the delivery of the MADE Alliance, further enhancing financial inclusion and digital accessibility across Africa; and with the World Food Programme to further capacitate small-holder farmers into agribusiness.
The Group demonstrated commitment to its shareholders by proposing a dividend of Ksh4.25 per share, a payout ratio of 34.5%, reinforcing its track record of delivering value to its shareholders. This is supported by a return on equity (ROE) of 21.5% and a return on assets (ROA) of 2.8%, which are well above industry averages.
Equity Group has adopted a tri-engine approach, integrating commercial, social, and sustainability priorities to foster sustainable economic growth and create meaningful societal impact. They continue to build on their legacy of resilience, strong governance, long track record of execution, self-disruption, agility, and scalability of their business model to thrive in the different markets it operates in. It has continued to grow the value it creates for its customers and stakeholders, becoming a regional systemic financial services provider in the top one or two in three of the six markets it operates in, Kenya, DRC, and Rwanda.
The Group’s strategic focus on regional expansion and product diversification continues to drive growth with the Group’s regional subsidiaries contributing 49% of total assets, 48% of total loans and 54% of profit before tax, further diversifying the revenue base.
The Kenya subsidiary, while still a major contributor, accounted for 46% of total revenue. Equity Bank Rwanda revenue grew YoY by 36%, Tanzania by 20%, and DRC by 9%, while PAT for Equity Bank Rwanda grew by 30% YoY, Tanzania by 107%, Uganda by 186%, and DRC by 29%, signaling increasing contributions from regional operations.
Equity Bank Kenya has, in the past six (6) months, cut its base lending rate three (3) times, sending a clear signal of its intent to grow its loan book as Kenya’s economy shows signs of recovery. The lowering of interest rates will reduce the cost of borrowing, offering businesses access to more affordable credit, while for households it means increased disposable income, thus stimulating consumer spending.
Due to the global operating environment characterized by unprecedented geopolitical shifts, the Group’s defensive and prudent approach to risk management was evident in its loan loss provisions, which amounted to Ksh20.2 billion. The Non-Performing Loan (NPL) ratio remained below industry average at 12.2%, significantly lower than the 16.4% published industry average. NPL coverage stands at 71%, reinforcing the Group’s strong asset quality.
The Life Assurance business continues to register impressive performance with YoY Profit before tax growing by 58% to Ksh1.5 billion from Ksh934 million. Further, the robust strategy for investment of policyholder funds resulted in a gross declared return of 13.5%, signaling Equity Group’s capabilities to provide value to the over 14 million policies issued since inception in March 2022.
With an eye on long-term value creation, the Group’s acquisition of a general insurance license, in addition to its existing life assurance license, marked an exciting milestone. This move enhances the Group’s ability to offer a comprehensive suite of insurance solutions, ensuring that customers across all segments, corporate, SME, and retail, can access integrated solutions that protect their life, health, and wealth.
“As we continue to expand our financial services ecosystem, our Bancassurance unit remains a vital component of our growth strategy. The 6% increase in premium collections, despite the current market challenges, underscores the unit’s potential,” said Dr. Mwangi in a press statement. “To unlock further growth, we invested heavily in the unit’s repositioning, focusing on talent development, digital transformation, and process enhancements. This medium-to-long-term strategy will allow us to deliver a more integrated, customer-centric experience, where insurance is a key layer in our customers’ overall financial well-being.”
Dr. Mwangi also noted that their insurance premium financing solution has seen a significant 50% increase in uptake, reflecting their dedication to supporting customers through uncertain times as they prioritize protecting their health, life, and assets.
As part of its ongoing transformation, Equity Group has continued to invest in technology, infrastructure, and diversification. They have modernized their digital channels, which now process 86% of all transactions, enabling customers to access a seamless and digital-first experience. Furthermore, ONE Equity, the Group’s integrated digital platform, allows customers to access a wide range of products and services under a single umbrella, enhancing cross-selling and customer engagement.
The value of business processed through Equity Mobile YoY increased by 67% from Ksh1.895 trillion to Ksh3.174 trillion while Equity Online for business (EazzyBiz) increased by 21% from Ksh3.165 trillion to Ksh3.841 trillion and the interoperable Pay With Equity (PWE) for merchants increased by 14% from Ksh1.884 trillion to Ksh2.149 trillion, ATM increased by 21% from Ksh398.6 billion to Ksh481.4 billion as customers and Kenyans embraced the newly introduced Cash Deposit Machines to ease the pain for businesses looking to access their cash after banking hours while Branches are evolving to be more SME, large enterprises and corporates focused, with transaction volumes increasing by 21% from Ksh4.176 trillion to Ksh5.046 trillion.
In his concluding remarks, Dr. Mwangi said the Group remains committed to driving positive change. He noted that their focus on financial inclusion, regional expansion, and sustainable growth will enable them to continue being a catalyst for economic empowerment and resilience across Africa.
“As we move forward, we remain optimistic about the future and will continue to leverage our strengths to create long-term value and impact for our customers and shareholders,” Dr. Mwangi concludes.
