Diamond Trust Bank has issued a profit warning following what they termed as a difficult working environment in 2020.
According to the bank the Covid-19 restriction measures that were put in place have taken a toll on their earnings this year.
DTB says that increase in restructured and delayed loan repayments by customers intensified during the year.
The statement from the bank read: The Board of Directors of Diamond Trust Bank Kenya Limited (“DTB”) makes this announcement pursuant to Regulation G.05(1)(f) and (2) of the Fifth Schedule of the Capital Markets (Securities)(Public Offers, Listing and Disclosures) Regulations, 2002 and for the information of investors and the general public.
The global economic performance for 2020 has been poor in view of the unprecedented negative impact of the COVID-19 pandemic and the introduction of diverse measures intended to curb its continued spread throughout the globe.
This has however had an unintended negative effect on the global economy, impacting trade flows and creating uncertainty in the export, hospitality, real estate, aviation, tourism and agribusiness sectors.
It is against this backdrop that the Board of Directors wishes to announce that DTB’s earnings for the current financial year are expected to be substantially lower than the earnings reported for the same period in 2019, based on its projected full year financial forecasts.
This is primarily due to an increase in impairment provisions in light of the COVID-19 pandemic as well as an increase in restructured and delayed loan repayments as the COVID-19 impact on customers intensified during the year.
DTB continues, and will continue, to support its customers through increased lending, development of new products, and expansion of its existing products, services and channel suite that can be accessed digitally, as well as the provision of various other financial solutions.
DTB has ensured that customers have been able to continue their uninterrupted access to the bank’s products and services both on its digital platforms as well as at its branches which have remained open during these unprecedented times.
DTB put in place enhanced health and safety measures very early on to ensure the wellbeing and safety of its staff and customers, and it has retained its entire workforce during these difficult times. DTB has invested in the Kenya Mortgage Refinance Company that has been established to support the Affordable Housing Pillar of the Government of Kenya’s Big 4 Agenda.
DTB is also participating in the Credit Guarantee Scheme for Micro, Small and Medium Sized Enterprises (“MSMEs) sponsored by National Treasury intended to ease access to credit for MSMEs.
KTo cushion its customers, DTB has granted loan relief and restructured loans to enable them manage their personal needs, day- to- day capital working capital requirements and deal with the stresses caused to their businesses following the outbreak of COVID-19. DTB’s balance sheet remains robust and resilient with a strong capital base and healthy liquidity position.
The Board and management additionally remain confident in DTB’s long-term strategy and wish to emphasise that various initiatives have been put in place that should result in improved future performance.
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