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Sidian Bank, a mid-tier bank focused on Small and Medium Enterprises (SMEs) has recorded an increase in its consolidated net profit to Sh486 million for the year to 31 December 2021 from Sh19 million in the prior year 2020. The increased profitability is as a result of the loan book growth in the period which grew interest income as well as lending fees. The lender received long term funding of over Sh3.5 billion in the year from Development Finance Institutions (DFIs) and its Partners which has supported the bank’s SME focus as the Home of Biashara Banking. The performance was also driven by higher income on government securities.
Increase in non-funded income in the period also enhanced profitability. This was driven by Trade Finance which continues to be the flagship product of the bank, Foreign Exchange (FX) income as well as banc-assurance income from higher transaction volumes. The bank also had increased digital transaction volumes and, in the period, introduced a one of a kind – Sidian Express till collection solution for businesses.
The impact of the increased incomes was countered by higher interest expense from customer deposits growth as well as expansion of its branch network. The bank’s balance sheet grew by 24 per cent to Sh41.4 billion as at 31 Dec 2021 compared to Sh33.5 billion as at 31 December 2020. Net loans and advances increased by 19 per cent due to continued lending to SMEs in the period in line with the bank’s growth strategy. Customer deposits grew by 14 per cent in the period attributed to continued deposit mobilization as well as increased transactional business from the bank’s customers.
In a statement, Mr. Chege Thumbi, Sidian Bank’s CEO, said “I am pleased with the bank’s performance this past year. Looking back, we have worked to ensure we have seamless processes and streamlined our digital solutions to offer our customers excellent service. As a bank we are keen on supporting SMEs and bring our services closer to our customers. We have continued our expansion and recently opened a branch in Kamakis, along the Eastern Bypass to bring services closer to customers in that region. We also continue to make investments in the digital space as we provide businesses with tailor-made financial solutions”