PRIME BANK: WE HAVE A RESPONSIBILITY TOWARDS SOCIETY

The concept of responsible banking is gaining credence globally. Describe how your bank is engaged in responsible banking.

Prime Bank is engaged in responsible banking by remaining committed in maintaining the Bank’s responsibility towards the society through our long standing commitment to initiatives focused on improvement of healthcare, education, support for the needy and nurturing of talent through sports. 

The Bank also maintains an exclusion list that prohibits lending to sectors that may have an adverse impact on society and environment.

 

Are you currently using the ESG (Environmental, Social and Governance) factors to measure your sustainability and the social impact of your business?

Yes.

How far are you from fully implementing the Banking Sector Charter?

 

Implementation status: 8/11*100=82%

How have you responded to your customers banking needs in the wake of the Covid-19 pandemic? 

Leveraging our Digital Banking Channels:

 We have optimized our digital banking channels  and debit and credit cards for payments  to ensure seamless cashless transactions for our customers to encourage  cashless  banking through our platforms Prime Mobi and Prime Net and our across a wide network of ATMs.

 


To facilitate this, we have waived all charges on:

  • Transfers from your account to MPESA and from MPESA to your account through Prime Mobi app.
  • PesaLink transactions until further notice.

For customers who wish to visit any of our branches, we remain open to serve them:

 We remain open and ready to serve our customers in line with National Government’s COVID-19 mitigation strategies to contain the pandemic.

 

  • All branches have made available alcohol-based hand sanitizers in the banking halls for customers and all staff have been instructed to adhere to proper hand washing with running water and soap and the use of the sanitizers.
  • To serve them better during this period, all staff handling cash has been provided with hand sanitizers, gloves, and masks and that they are adhering to washing their hands regularly.
  • We continue to maintain cleanliness and germ free environment, all branches and head office departments have been advised to observe routine wiping of all surfaces with cleaning agents.
  • Social distancing is being observed in all our branches’ to ensure customers do not crowd in queues but are well spaced in an orderly manner at least 1 Metre between each customer.

 

How has the Covid-19 pandemic impacted your performance so far and going forward?

The pandemic had a very little bottom line effect on the first quarter performance given that the pandemic was in its initial stages at the end of March. Higher impact of the pandemic will be felt onwards from the 2nd quarter.

 


How would you describe your performance in 2019? (One word).

Satisfactory

 


Where did growth come from if any?

The growth came from increase in Deposits leveraging on Customer Service and Technology.

Overall, how do you rate the quality of your loan portfolio?

Our loan portfolio continues to remain strong with our net non- performing loans being much lower than that of the industry

What is your average loan size and average loan repayment period?

Our average loan size stands at KShs. 10Million with an average repayment period of 48 months.

What is the distribution of your credit portfolio by sector, i.e. agriculture, manufacturing, construction, housing, trade and commerce etc.?

30 % percent of the loan book is lent out to wholesale and retail trade, 22% to manufacturing, 15% to real estate, 15% to business services, 13% to others.

How would you describe the performance of your bank over the last 10 years?

The Bank has witnessed steady and consistent growth thereby achieving a balance sheet size of Ksh 108 Bn and Profit after Tax of over KShs 2 billion.

What does the year 2020 and the next 10 years portend for your bank?

In the next decade, Prime Bank will continue to leverage on its strengths with a view to becoming a Tier I bank and having a Regional Presence with focus on Digitalization.

The interest rate capping that has had a major impact on the banking sector has finally been scrapped. What does that mean for your bank and the industry?

Improved credit conditions which will enable banks to realize growth strategies. This will in turn increase earnings and profitability with credit being advanced to key sectors like micro, small and medium enterprises.

How has the removal of the law affected your financial performance so far?

There is no impact on profitability because our pricing is very competitive.

Any new investments or advancements in ICT at the bank?

We have invested heavily in technology with the setting up of a Digital Hub to boost our digital banking platforms PrimeMobi and PrimeNet to meet our customers’ banking needs. We have also upgraded our mobile banking app PrimeMobi to provide easy navigation, apart from offering additional features.

 


Does your bank have a mobile money lending platform? What is the loan uptake from the platform and the overall quality of the loans taken?

Plans are at an advanced stage in setting up mobile money lending platform.


How is PesaLink’s usage as compared to, EFT, RTGS and other funds transfer methods?

Over the last year, we have seen sharp increase in the usage of PesaLink, though RTGS is still the most preferred method.

What is the growth trend in the adoption of online and mobile technology in your bank?

We have noted a significant increase in the use of our online platforms especially PrimeMobi and PrimeNet.

Any changes on your business model?

We have embarked on consolidating our niche market through customer segmentation and relationship management where customers have been segmented into strategic business units. We are also transforming the business into the financial solutions provider of first choice with a view to identifying opportunities for improving our operational efficiency, enhancing customer experience.

How is the scrapping of interest rate cap going to affect your strategy?

The scrapping of the interest rate cap will not affect our strategy.

 


What is your growth plan, where do you see yourselves in 5 years?

We would like to position ourselves as a preferred Bank providing digital services to all customer segments.

How would you describe our macroeconomic environment currently (globally and locally)?

The World Bank had projected the world economy to grow by 2.5 per cent pegged on reduced global trade tensions.

However, this growth remains uncertain due to the global outbreak of Coronavirus Covid-19, with a perception that the world may experience a recession.

Back at home, improved private sector credit growth, and expectations of a recovery in the agriculture sector had boosted growth prospects to between 5.6 to 5.8 percent – according to World Bank - for the year 2020. However, Central Bank of Kenya has downgraded the outlook to a paltry 2.5 per cent due to the pandemic which has disrupted domestic production and supply chains as well as trade with the country’s main trading partners. Moreover, the perception of the World Bank and IMF is not optimistic

What do you see as the biggest threats to Kenya’s banking sector?

High NPL’s arising from a slow economy, Prevalence of fraud, competition from new entrants and AML/CFT risk.

 


What are the next growth drivers in Kenya’s banking sector and why do you think so?

Innovation and adoption of new technologies specifically fronted by financial technologies (fintech) and data analytics will have unprecedented opportunities to change and improve how we provide financial services and products. Nearly half of Kenyans maintaining bank accounts are increasingly using digital products and mobile banking as compared to traditional banking products and services.

    

Recent developments within the last one year

Over and above our 21 branches across the country, we expanded our local network, in line with our strategic plan by opening a branch at Lavington Mall. We also moved our Westlands Branch to Sarit Centre, bigger and spacious premises with 7-Day Banking for convenience of our customers.

On products and solutions innovation, we continued to invest in technology with the setting up of a Digital Hub to boost our digital banking platforms PrimeMobi and PrimeNet to meet our customers’ banking needs. We continuously work on understanding and meeting the customer requirements.

To that effect, we upgraded our mobile banking app PrimeMobi to offer customers a better feel, easy navigation with additional functionalities.

We continued with the broadening of our countrywide network of ATMs and the installation of the virtual branches-Smart ATMs - in new locations.

In the same year, we fast-tracked the installation of Cash Deposit Machines (CDMs) in strategic locations. In response to our customers’ needs, the Bank is providing an innovative service – “Bank on Wheels”- a specially designed truck which is driven to the premises of corporate customers to address their banking requirements.

List of Current Directors

Dr. Rasik C. Kantaria
Chairman

Mr. Shantilal K. Shah
Vice Chairman

Mr. Amar Kantaria
Executive Director

Mr. Bharat Jani
Managing Director

Mr. James N. Mungai
Director

Mr. Terry Davidson
Director

Mr. David .G.M Hutchison
Director

Mr. Jinaro K. Kibet
Director

Mr. Farid Mohamed
Director

Mr. Biniam Yohannes
Director

Mr. Skander Oueslati
Director

Mr. Arun Shah
Company Secretary
Auditors (As at 31st Dec 2019)

Deloitte and Touché

Certified Public Accountants (Kenya)

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