african banking corporation - abc bank | achieve the ... in 2016: • thika road mall (trm) •...

www.abcthebank.com

African Banking Corporation- A Profile

“Empowering you to achieve the extra ordinary”

ABC Bank is regulated by the Central Bank of kenya

Rating : A2 (Short term) | BBB (Long term)

About ABC Bank

Our Group Companies

Mission, Vision & Core Values

Important Milestones

Awards and Accolades

ABC Bank Group Structure

Board of Directors

Senior Management Team

Business Units

Products and Services

Partnerships

Key Events 2015 - 2016

Performance Overview

Branch Network

Why ABC Bank

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Contents

African Banking Corporation Limited 2

We are a mid-sized, award-winning indigenous bank with over 30 years of experience. We believe in personal growth and development: where you are today should only be a launch-pad to greater things tomorrow. We are willing and eager to take the growth journey with you as your dependable financial partner. As per our vision, “empowering you to achieve the extraordinary,” we would like you to believe that nothing is beyond your reach, with ABC Bank as your financial partner.

Our Branch network: We have 12 branches countrywide:

Nairobi: • Westlands • Koinange Street •Industrial Area •Libra House on Mombasa RoadOpened in 2016: • Thika Road Mall (TRM) • Greenhouse Mall (GHM) on Ngong Road

Upcountry: • Mombasa • Kisumu • Meru • Eldoret • Lamu • Nakuru

ABC Bank has carved a special niche in providing focused financial services and solutions to a wide range of clients who include individuals, Small and Medium Enterprises, Corporate organizations, Saccos, Learning Institutions, Religious institutions and service providers for various economic sectors. We facilitate efficient service to our business clients through innovative, customized financial solutions, emphasizing our main strengths in asset finance, trade finance, international and local remittance solutions, invoice discounting, overdrafts and term loans. We also have a variety of banking solutions that are flexible and focused on meeting the specific financial needs of our individual customers in each economic sector of East Africa.

ABC Bank Group Companies - ABC Bank - Kenya, ABC Capital Bank – Uganda, ABC Capital Limited and ABC Insurance Brokers.

About ABC Bank


ABC CAPITAL LTDABC Capital is a leading stock brokerage company in Kenya offering a flexible range of world class wealth management services to investors in the East Africa region.

As a member and shareholder of the Nairobi Securities Exchange (NSE) since inception in 1954, the firm has shared a rich heritage in the fortunes of one of Africa’s

leading stock markets. ABC Capital was acquired by African Banking Corporation Limited (ABC Bank) in 2008. Thus ABC Capital immediately benefited from ABC

Bank’s professionalism and key competencies of relationship management and expert approach in terms of its operations embodied in the ISO 9001:2008

certification awarded to the bank in January 2008. This makes ABC Capital’s client experience, provided through the bank’s branch network, exceptional.

ABC INSURANCE BROKERS LTDPreviously known as Flagship Insurance, ABC Insurance Brokers (ABCIB) is a member of the Association of Insurance Brokers of Kenya (AIBK) and is registered by the

Insurance Regulatory Authority (IRA). ABCIB offers a wide range of comprehensive products such as motor vehicle, fire, computer, marine, burglary, and life

insurance. Other products include work injury benefits (WIBA) compensation, mortgage protection, bonds and domestic package insurances. ABCIB has been in

existence for over 22 years, and has a strong team of experienced professionals, guided by the company principles of customer-centricity, integrity, credibility and

accountability; to meet individual and family insurance needs, as well as a variety of business insurance products.

ABC CAPITAL BANK UGANDA The Bank started its journey in 1993, as a deposit taking financial institution then trading by the name Capital Finance Corporation Limited, licensed and supervised

by Bank of Uganda under the Financial Institutions Act 2004. In 1999, in order to diversify its products range, the institution applied to the Bank of Uganda for a Forex

Bureau License which allowed it to establish a fully owned subsidiary under the name Capital Finance Corporation Forex Bureau. With this solid background, Capital

Finance Corporation Limited looked forward to the next momentous step of converting into a fully fledged commercial bank. As advised by Bank of Uganda, Capital

Finance Corporation Limited sought a strategic banking partner and identified one in ABC Bank, a fast growing, Kenyan-incorporated private bank of 25 years.

Through the tireless efforts of the Directors of Capital Finance Corporation Limited, and after adhering to all the formalities and stringent requirements of the Bank

of Uganda, ABC Capital Bank Limited Uganda came into being. It was licensed by Bank of Uganda as a commercial bank on 26th February 2010. With a four branch

network in Uganda, the Bank is aggressively growing both in retail as well as corporate banking business.

Our Group Companies


Our Vision, Mission & Core Values


Empowering you to achieve the extraordinary

OUR VISION

OUR MISSION

OUR CORE VALUES

To nurture long lasting relationship with all our stakeholders through innovative

value adding financial solutions and services that help them realize their objectives

• Customer Centricity

• Professionalism

• Team work

• Excellence

• Commitment

To be East Africa’s leading bank in innovation, Products & Process transfer and customer delight!!

OUR GOAL

Important Milestones


• Business model realigned into SBUs: Corporate, Business & Retail Banking

2007

2015• First Bank to launch new Money Transfer service- Transfast• Signed MOU with East African Exchange (EAX) establishing e-trading in commodities• Established business relationships with counties and saccos• Maintained Stable rating by GCR : A2(KE)

2014• ABC Insurance Brokers , an ATI approved agent, acquired• Successful 1Bn Bond issue - 157% subscription recorded

• Rating upgrade by GCR from A3(KE) to A2(KE)• Launch of Agent Banking with Post Bank (99 outlets)

and 890 Mashinani Agents countrywide• Commencement of SACCO partnerships & collaboration

2012 2008• ABC Capital Ltd(Kenya), a brokerage firm, acquired

• The first bank in Kenya to receive full ISO certification ( ISO 9001:2008)

1984• Opening of “Consolidated Finance

Company Ltd (CFC Ltd), Nairobi Kenya”

2016• Opened Thika Road Mall and Green House Mall branches

• Think Business Special Award for Product Innovation (County Revenue Collection)

1995• CFC Ltd transformed into ABC Bank

• ABC Capital Bank, Uganda formally added to the fold• The First bank in Kenya to receive a Euro 7m credit facility for onward lending to SME’s from the European Investment Bank (EIB)

Awards & Accolades


2016Think Business Awards

•Special Award For Product Innovation - County Revenue Collection and Management Solution

2015The Banking Awards

•Best Bank in Product Innovation-1st Runners Up

2014Champions of Governance

Award 2014•1st Runners-up Overall

• 1st Runners-up in the Finance and Investment Category

•First non listed bank to win Champions of Governance award

The Banking Awards•Best Bank in Internet Banking –

1st Runners up

2013Champions of Governance Awards

•Finance & Investments Sector3rd Position

The Banking Awards•Fastest growing Bank – 2nd Position

•Best Bank in product Innovation (M-Transfer)– 3rd Position

•Best Bank in technology use 2nd Position

2012Best Bank Award Tier III – 1st Position

Best Bank in SME Banking- 3rd Position

Best Bank in Product Innovation- 3rd Position

2011 2010 2009 2007Innovation Award

•3rd PositionThe Banking Awards

•Best Bank in Customer Satisfaction2nd Position

The Banking Awards • Best Bank in Tier III

1st Position

The Banking Awards• Best Bank in Product Marketing

3rd Position• Best Bank in Customer satisfaction

2nd Position

ABC Bank Group Structure


Corporate Banking

SME Banking

Retail Banking

Treasury Services

Alternative Channels

Emerging Channels

Cards

Trade Finance

Remittances

Diaspora Banking

Internet Banking

Mobile Banking

Cash Management

County Collections

SACCOs

Custodial Services

Trading (Equities,

Fixed Income

and derivatives)

Portfolio Management

Corporate Finance

Research

Agency Relations

Financial Services

Advisory

General Insurance

Non General Insurance

Credit Risk Insurance

Current Key Metricsfor

ABC Bank (Kenya)

ABC Bank Group

BANKING STOCK BROKERAGE &

INVESTMENT & FINANCIALSERVICES

INSURANCE AND RISKMANAGEMENT

12 Branches accross Kenya

Over 300Employees

Over 8,000Active Internet Banking

Users

40,000 Accounts andGrowing

Our Board Of Directors


MR. RICHARD OMWELAIndependent Non Executive Chairman• LLB Degree, Diploma in Law• Advocate, The High Court of Kenya• Partner, Hamilton Harrison & Mathews Advocates,• Chairman, Kenya Rugby Union (KRU)

MR. ASHRAF SAVANIIndependent Non Executive Director• Bachelor of Commerce, Diploma in Banking.• Former chairman, ABC Bank• Over 50 years of Banking Experience• Awarded, Life Time Achievement Award in Banking (Think Business)

MR. JOSEPH K. MUIRURIIndependent Non Executive Director• Fellow, Chartered Association of Certified Accountants (UK)• Practitioner, Institute of Certified Public Accountants of Kenya• Over 35 years auditing accounting experience• Former Partner, Ernst & Young East Africa

MR. ALBAN MWENDARIndependent Non Executive Director• Master of Business Administration, B.Ed, Member- HRM (Kenya).• Former Group HR director at Kenya Commercial Bank• Currently, Group Human Resources Director at Kenya Airways.• Over 28 years of Experience

MR. ANIL ISHANIIndependent Non Executive Director• Qualified Barrister at the Middle Temple in London• Fellow, Chartered Institute of Arbitrators• Former Senior partner, City firm of Adlers Solicitors• Currently, a consultant and a Council Member Superbrands

MR. SHAMAZ SAVANIGroup Managing Director• Master of Business Administration, Bachelor of Arts (Economics),• Bachelor of Commerce (Finance)• Over 20 years of banking experience

MR. SRIDHAR NATARAJANGroup Chief Executive Officer• Master of Science, Certificate in Strategy & Leadership• Former, President Director (CEO) of Bank ICB Bumiputera, Indonesia• Vice President /DGM of leading Banks in India, Hong Kong.• Over 34 years of Banking Experience in India, SE Asia, China & HK

Our Senior Management Team


PETER KINYANJUI

General Manager

• Master of Business Administration, Bachelor of Science in Business Administration

• Associate of the Chartered Institute of Bankers (ACIB) London

• Fellow of the Kenya Institute of Bankers (FKIB)

• Former, Managing Director & CEO at Family Bank Ltd

• Over 31 years of Banking Experience

The ABC Bank management team is made up of seasoned professionals determined to deliver superior products and services to our Retail, SME

and Corporate customers. We take pride in the passion, experience, leadership, professionalism and vision of our staff.

Our focus is to continue investing in technology and new innovation for efficient banking operations that will see the bank attain Tier II position by

year 2021.

PHILIP WAMBUAGeneral Manager, Treasury & Financial Institutions• Bachelors Degree in Economics and Business studies• Former, Head of Treasury, Custodial Services & Institutional Banking at Bank of Africa-Kenya• Over 23 years of Commercial Banking Experience

RAJ PAL ARORAChief Credit Risk Officer• Master of Science (Physics), Bachelor of Sc. (Physics), Bachelor of Laws• Associate of The Indian Institute of Bankers• Former Chief Executive Officer at EABS Bank Ltd• Over 35 years of Banking Experience

Our Senior Management Team cont…


AMANDA CORLINE Head of Retail Banking• Bachelor of Arts (Economics & Sociology)• Formerly Business Manager at UBA Kenya Ltd• Over 15 years of Banking Experience

LEE GACHOMBAHead of SME Banking• Bachelor of Commerce (Accounting)• Member, Institute of Certified Public Accountants of Kenya• Formerly Relationship Manager-Corporate Banking at NIC Bank Ltd• Over 15 years of Banking Experience

JOSIAH MUIA

Head of Corporate Banking

• Master of Business Administration, Bachelor of Commerce

• Formerly Head of Corporate Banking at UBA Kenya Ltd


SAMUEL MUCHIRIHead of Finance• Master of Business Administration (Finance), Bachelor of Commerce• Member, Institute of Certified Public Accountants of Kenya• Formerly Head of Finance & Admin at Kenya Commercial Bank (Uganda)• Over 10 years of Banking Experience

LUCY WARIARA

Head of Human Resources

• Bachelor of Arts, Sociology, Business Administration & Economics,

Higher Diploma Human Resources Management

• Formerly Human Resources & Administration Manager at Midland

Energy Ltd

ELIZABETH KIMANI

Head of Operations

• Bachelor of Commerce

• Member, Institute of Certified Public Accountants of Kenya

• Formerly Head of Operations at Family Bank Ltd



Our Business Units

SME BANKING

RETAIL BANKING

TREASURY

CUSTODIAL BANKINGALTERNATIVE AND EMERGING CHANNELS

CORPORATE BANKING

This unit focuses on developing technology-led innovative products that give customers a convenient alternative to visiting branches including Internet Banking, Cash management services, Mobile banking, ATMs, Debit cards and Agency banking. Alternative Channels offers solutions to Saccos such as cheque clearing. Recently, ABC Bank through this unit, partnered with Kirinyaga County to offer revenue collection and management solution with partner Saccos in the county acting as the Bank's agents.

For Retail as well as Corporate customers and institutional investors, the Bank offers extensive custodial services, working closely with ABC Capital Limited to facilitate these transactions.

The Treasury unit offers various foreign exchange products and services to cater for customers’ different commercial activities, hedging requirements and investment needs.

The unit is also responsible for our robust Financial Institutions and Correspondent Banking activities.

Focused attention is on the individual, providing versatile savings, transaction and investment products for wealth creation at very affordable rates. Every customer enjoys the support of a customer service officer and personal banker. The unit also offers diverse products and services to cater for the needs of our customers in the diaspora. Learning and Religious institutions are also driven by retail banking.

The unit is focused on mid to large corporates operating in various economic sectors who require specialized solutions and tailor made financial structuring to achieve optimum returns on their investments in manufacturing, commercial transportation, project development, import & export finance among many others. All clients are assigned a dedicated Relationship Manager and Credit Analyst.

Businesses emerging into corporates are facilitated through this unit. Customers featured include service providers, commodity suppliers, suppliers to businesses who need flexible terms and rapid facilitation. This unit has been configured to guide the business from being an established SME into an emerging corporate. All accounts have a dedicated Business Development Manager to fully manage customers’ needs.


Our Products and Services

TRANSACTION ACCOUNTS• Corporate Current Accounts

• Chequing plus- Corporate schemes

• Hazina SME Account• Kisima Account• Chequing Plus Account• Zalisha Current Account

• Taiseer - Corporate Schemes • Chama Account • Pesa Account • Taiseer Account • Lea Account • ABC Global Accounts (Diaspora Banking)

• Uwezo Account

SAVINGS & INVESTMENT ACCOUNTS• Pure Savers Account• Young Star Account• Fixed Deposit Account• Target Account• Flexi Fixed Account

LENDING PRODUCTS• Term Loans• Asset Finance• Overdrafts• Mortgages

LOCAL AND INTERNATIONAL TRADE FINANCE• Bills Discounting• Invoice Discounting• Letter of Guarantee• Bonds• Letter of Credit

• Pre-shipment Finance• Post Export Finance• Documentary Collections• Clean Collection

TREASURY SERVICES• SPOT Transactions• Forward Contracts• Bureau de Change• SWAPS• Research and Market Updates• Custodial services MONEY TRANSFER SERVICES

• Instant Cash• Western Union• RIA (Euronet Worldwide)• Swift Global• MoneyGram• Transfast• Al Dahab exchange• ABC M-Transfer• iRem

• M-Pesa - Retail - Super Agency - Bulk - Paybill Service• Airtel Money - Retail - Super AgencyALTERNATIVE AND EMERGING CHANNELS

• Internet Banking• MasterCard debit card• Alerts(SMS, Email, E-Statements)• Insurance services• Agency Banking

• Cash Management• Sacco Revenue• County Collection• Mobile Banking• iTax

• Unsecured Personal Loans• Hire Purchase• Insurance Premium Financing

INTERNATIONAL LOCAL


Our Key Partnerships

At ABC Bank, we have continually sought avenues to spread our wings and diversify our product offering to customers by partnering with different institutions. A. Cheque clearing services

In the recent past, we have partnered with various Saccos including; Fortune Sacco, Capital Sacco, Bingwa Sacco, Imarika Sacco, Unaitas Sacco and other large institutions such as PostBank, to offer cheque clearing solutions to their customers. Through the partnerships, the Saccos are able to issue personalized cheque books to customers, and ABC Bank serves as the clearing house through which the cheques are processed. Saccos traditionally do not offer certain products such as cheque books, Real Time Gross Settlement (RTGS) and Electronic Funds Transfers (EFTs). Until ABC Bank introduced this service, Sacco members especially those operating businesses had to turn to commercial banks for these services. (Consequently, Saccos register significant customer attrition and stiff competition from commercial banks and deposit-taking microfinance institutions). This solution is part of ABC Bank’s plans to provide more relevant financial services to small and medium enterprises, who are key drivers of the economy, and is well appreciated by saccos and their members.

B. Warehouse financing for grain farmers

ABC Bank recently signed an agreement with East Africa Exchange (EAX) to help grain farmers and traders obtain financing against their produce deliveries. This partnership enables farmers protect their produce against storage-related damage and negotiate for better prices. Through the deal, ABC Bank provides finance for electronic warehouse receipts to grain farmers and traders supported by EAX, and will also provide a clearing and settlement services platform integrated with the national payment systems and mobile banking solutions.

C. Local and International Money Transfer services

The Bank has partnered with numerous local and international money transfer services to provide a variety of options to its growing customer base.

Local Partnerships include: •Safaricom •Airtel

International Partnerships: •Moneygram • Western Union •Transfast •Ria/Euronet • Instant Cash • Al-Dahab Exchange • Exchange for free (ABC M-transfer) • Swift Global

Our Partners


Key Events 2015 -2016


East Africa Exchange partnership – March 2015

ABC Bank signed an agreement with East Africa Exchange (EAX) to help grain farmers and traders obtain financing against their produce deliveries.

EAX is a commodity exchange that aims to increase regional market efficiency and give the East Africa's growing population, particularly smallholder farmers, better access to commercial markets, and link them to agricultural and financial markets.

ABC Bank Google+ Hangout – May 2015

ABC Bank became the first Kenyan financial institution to host a Google+ Hangouts on Air, dubbed #ABCofBiz. The Bank used the opportunity to engage and connect with customers and the general online community. The hangout discussed common mistakes in business and how entrepreneurs can avoid them to propel their businesses to success.

Imarika Sacco Partnerships – January 2015

In our continuous effort to support Saccos and microfinance institutions (MFIs) to offer a wider range of products and to deepen financial access in the country, we signed a partnership with Kilifi-based Imarika Sacco to offer current account services to its customers.

ABC Bank Head of Retail Banking Ms. Amanda Corline (right) and Imarika Sacco Chairman Mr. Richard Dzombo exchange partnership agreement documents

ABC Bank Group Managing Director Shamaz Savani and EAX Chairman Dr. Jendayi Frazer after signing the agreement

Prof. Bitange Ndemo (2nd left), co-moderator Churchill Ndambuki (2nd right) and Lee Gachomba

European Investment Bank credit line – December 2015

ABC Bank and the European Investment Bank signed a Ksh. 554.8 million (Eur 5M) for onward lending to Kenyan small and medium enterprises (SMEs). The credit line from EIB was a top up of a previous Ksh. 770 million received in 2012, which made ABC Bank the first local bank to enter in to a credit line agreement with the world's largest international public bank to ease credit access for small and medium enterprises.

ABC Bank Group MD Shamaz Savani (right) with EIB Vice President for East Africa Pim Van Ballekom during the signing ceremony



ABC Bank Hosts Chinese New year Celebrations – February 2016

ABC Bank hosted the Chinese community living in Kenya as they ushered in their new year at the Villa Rosa Kempinski. The event was organized by Guangdong Association, an umbrella body of Chinese business people in Kenya. ABC Bank utilized the opportunity to engage the growing Chinese community in Kenya, with a view to cultivating mutually beneficial partnerships.

ABC Bank partners with Capital Sacco to offer cheque clearing solution – April 2016

ABC Bank signed a partnership with Meru-based Capital Sacco to allow the Sacco’s customers make payments using cheques. Through the deal, ABC Bank provides cheque clearing services to Capital Sacco, which has 15 branches. Through the partnership, the Sacco can now issue personal cheque books to its close to 150,000 customers. ABC Bank acts as the clearing house through which the cheques are processed. This has enhanced ease of payments and improved efficiency of doing business for the Sacco members.

ABC Bank partners with Bingwa Sacco to offer Agency services – February 2016

ABC Bank signed an agency partnership with Kirinyaga-based Bingwa Sacco as part of its strategy to reach more customers and enhance its service offering. The Sacco will serve as the bank's revenue collection agent for Kirinyaga County government. Additionally, the partnership allows ABC Bank customers to access financial services at any of the 18 Bingwa Sacco branches. This enables ABC Bank to reach more customers who can now access our services from more locations where we are not physically present.

ABC Bank Group CEO Sridhar Natarajan (right) and Guangdong Association Vice-Chairman Hongjin Wu toast to the New Year.

ABC Bank Group General Manager- Business Development Peter Kinyanjui (right) exchanges memorandum documents with Bingwa Sacco Chairman Cyrus Kabira (left) as Sacco CEO Jane Mugo looks on.

ABC Bank Group General Manager Peter Kinyanjui (centre), Meru County Senator Kiraitu Murungi (left) and Capital Sacco Chief Executive Eliezer Kaburu unveil the co-branded cheque


Awards

Achievements


ABC Bank and East Africa Exchange in Sh200 million deal in grain trade financing for farmers – May 2016

ABC Bank and the East Africa Exchange committed a Sh200 million credit line in a collaborative initiative to offer small scale grain farmers affordable grain trade finance. During a stakeholders’ forum held in Eldoret and graced by EAX Board chair, Former Amb. Dr. Jendayi Frazer in Eldoret, Uasin Gishu County Governor, Hon. Jackson Mandago said the initiative will have a positive impact, especially the warehouse services which contribute to solving the challenges of grain storage and marketing, further expressing the North Rift region’s support through North Rift Economic Bloc (NOREB) and the Uasin Gishu county Ministries of trade and agriculture.

Credit Rating Upgrade by GCR (South Africa) The Global Credit Rating Company (GCR) upheld ABC Bank's upgraded rating of A2 short term and BBB long term which was assigned in 2014.The favourable rating came on the back of the bank's improved capitalization, enhanced risk management process, sufficient liquidity buffers and our earnings profile. An A2 rating indicates a very strong capacity for payment of financial commitments not significantly vulnerable to foreseeable events. A BBB rating indicates good credit quality and that default risk is currently low, with adequate capacity for payment of financial commitments.

2015 Banking AwardsABC Bank was awarded the 1st Runners Up in the Best Bank in Product Innovation category, during the Think Business Banking Awards. The award winning product was the electronic Warehouse Receipt Financing solution the bank introduced in March in partnership with East Africa Exchange (EAX)..

2016 Banking AwardsABC Bank was awarded the Special Award for Product Innovation in the 2016 Think Business Awards. The Bank was recognized for the game-changing Revenue Collection and Management Solution it developed for Kirinyaga County. The Bank becomes the first entrant to claim the win in the category which was introduced this year.

ABC Bank and East Africa Exchange in Sh200 million deal in grain trade financing for farmers – May 2016

ABC Bank’s Head of Operations Elizabeth Kimani, Head of Alternative Channels Rosemary Muturi and ICT Senior Manager Alex Musumbi, receive the Special Award

ABC Bank’s Head of SME Banking Lee Gachomba (centre) and Card Centre Manager Dominic Muriithi receive the award


CSR Events 2015 - 2016

ABC Bank sponsors Catholic Education Commission conference – March 2016

ABC Bank sponsored the Catholic Private Schools Education Conference held at the Catholic University from 8th to 11th March to the tune of Ksh. 250,000 in support of the church’s efforts in improving educational standards in the country.

ABC Bank supports improvement of Catholic Church Health facilities - February

ABC Bank donated Sh.250,000 in support of health facilities under the Catholic church. Presenting the donation to the Kenya Conference of Catholic Bishops, Head of Retail Banking Amanda Corline said the Bank is committed to plugging the gap in health care by supplementing the public sector efforts by partnering with the private sector. The funds will go towards the improvement of health facilities under the Catholic Church.

ABC Bank visits Kayole Street Children Rehabilitation Centre - August 2015

ABC Bank has over the years supported the Kayole Street Children Rehabilitation Centre with food, clothing and other items. This has been one of the Bank's CSR initiatives through which volunteers employees support the former street children through cash and food donations, as well as mentorship.

ABC Bank, as a good corporate citizen, upholds the tenets of a socially responsible organization, always making conscious efforts to ensure that its operations benefit its immediate environment and the people who live in it.

We support community initiatives with projected positive impact on the largest number of households and individuals. Our key CSR support areas are: Education, Empowerment and Financial Literacy, Health and Environment

ABC Bank’s Head of Retail Banking Amanda Corline presents the cheque to KCCB Chairman Bishop Philip Anyolo (centre) and KCCB- Commission for Education Chair Bishop Maurice Makumba

ABC Bank Head of Retail Banking Amanda Corline presents the Sh. 250,000 cheque to KCCB’s Bishops Paul Kariuki (centre) and Anthony Ireri

ABC Bank staff pose with some of the children at the home after donating food stuffs.

Group Performance Review


Ambitious Deposit growth plans were put on hold on account of very high interest rates for deposits and treasury bill/bonds in Q4/2015

Group Financial Highlights FY 2015


Profit Before Tax grew to Ksh. 388.4 million from Ksh. 336.9 million recording a 15% growth year on year. This was driven by growth in interest income (Ksh. 243m), and drop in operating cost in line with our cost efficiency strategy.

67.7

162.4 229.1

336.9

116.7

195.5

302.6

388.4

Q1 H1 Q3 FY Q1 H1 Q3 FY

2014 2015

Pr Before Tax ( Ksh. Million)

I BALANCE SHEET Bank Group 31st Mar

2015 31st Dec

2015 31st Mar

2016 31st Mar

2015 31st Dec

2015 31st Mar

2016 Unaudited Audited Unaudited Unaudited Audited Unaudited

Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ A ASSETS

1 Cash ( both Local & Foreign) 172,123 181,083 176,534 198,790 224,355 221,456 2 Balances due from Central Bank of Kenya 692,915 903,947 1,192,352 744,289 1,006,547 1,307,144 3 Kenya Government and other securities held for dealing purposes - - - 4 Financial Assets at fair value through profit and loss - - - 5 Investment Securities: - - -

a) Held to Maturity: 4,346,728 3,398,545 2,900,091 4,922,935 3,848,018 3,297,451 a. Kenya Government securities 4,102,526 3,241,430 2,900,091 4,102,526 3,241,430 2,900,091 b. Other securities 244,202 157,115 - 820,409 606,588 397,360 b) Available for sale: 829,158 499,621 480,881 829,158 499,621 480,881 a. Kenya Government securities 829,158 499,621 480,881 829,158 499,621 480,881 b. Other securities - - -

6 Deposits and balances due from local banking institutions 80,977 91,784 82,963 90,187 98,937 95,333 7 Deposits and balances due from banking institutions abroad 198,098 31,481 145,324 349,055 343,715 480,108 8 Tax recoverable 80,302 20,655 20,655 94,354 35,038 34,777 9 Loans and advances to customers (net) 12,945,731 14,828,522 14,062,190 13,501,549 15,292,071 14,518,774

10 Balances due from banking institutions in the group 10,579 11,479 12,112 - - - 11 Investments in associates - - - 12 Investments in subsidiary companies 885,405 885,405 885,405 13 Investments in joint ventures - - - 14 Investment properties - - - 15 Property and equipment 525,726 498,770 527,216 564,607 532,416 558,792 16 Prepaid lease rentals - - - 17 Intangible assets 138,636 132,362 128,134 139,022 132,719 128,385 18 Deferred tax asset 31,501 25,440 25,440 33,125 29,943 30,046 19 Retirement benefit asset - - - 20 Other assets 869,986 549,203 1,088,356 976,146 574,364 1,138,960 21 TOTAL ASSETS 21,807,865 22,058,297 21,727,653 22,443,217 22,617,744 22,292,107

B LIABILITIES

22 Balances due to Central Bank of Kenya - 1,098,624 838,402 - 1,098,624 838,402 23 Customer deposits 16,451,190 15,774,465 15,995,342 16,816,733 16,300,473 16,485,489 24 Deposits and balances due to local banking institutions 510,117 370,229 101,449 510,117 370,229 101,449 25 Deposits and balances due to foreign banking institutions 148,423 184,213 196,942 148,423 - 24,387 26 Other money market deposits - - - 27 Borrowed funds 1,494,354 1,404,578 1,350,014 1,494,354 1,404,578 1,350,014 28 Balances due to banking institutions in the group - - - 29 Tax payable 32,790 - 33,520 36,427 - 38,068 30 Dividends payable31 Deferred tax liability - - - - - - 32 Retirement benefit liability - - - 33 Other liabilities 482,118 389,580 315,394 569,343 413,454 368,767 34 TOTAL LIABILITIES 19,118,992 19,221,689 18,831,063 19,575,397 19,587,358 19,206,576

C SHAREHOLDERS’ FUNDS35 Paid up /Assigned capital 1,050,000 1,050,000 1,050,000 1,050,000 1,050,000 1,050,000 36 Share premium/(discount) - - - 37 Revaluation reserves (18,436) (60,908) (79,139) (122,011) (136,555) (154,786)38 Retained earnings/Accumulated losses 1,557,100 1,733,365 1,811,578 1,561,652 1,742,052 1,822,733 39 Statutory loan loss reserves 100,209 114,151 114,151 105,767 120,957 118,717 40 Other Reserves (11,183) (30,322) (38,260)41 Proposed dividends - - - 42 Capital grants

P.O. BOX 46452 - 00100, NAIROBI. Tel: (020) 4263000, 2223922, 2251540/1, 2226712Email: [email protected] Website: www.abcthebank.com

QUARTERLY FINANCIAL STATEMENTS AND OTHER DISCLOSURES AS AT 31ST MARCH 2016



Interest Income grew by 9% year on year to close at Ksh. 2974.6 million in 2015 (FY 2014: Ksh. 2731.5 million). This was mainly driven by increased margin in line with our 12% growth in loans and advances

647.3

1312.8

1838.8

2731.5

692.7

1407.5

2060.3

2974.6


2014 2015

Interest Income (Ksh. Million)



The loans and advance(net) expanded by 12% (Ksh. 15.3 billion) year on year driven by increased uptake of our loan products (FY 2014: Ksh. 13.7 billion)

11.35 11.65

12.68

13.68 13.50 14.09 14.31

15.29


2014 2015

Loans and Advances (Ksh. Billion)



Total Customer Liabilities grew by 6% (Ksh. 0.9 billion) from Ksh. 16.4 billion in 2013 to close at Ksh. 17.3 billion in 2014.We let go some high cost deposits in Q4, 2015 on account of a steep hike in interest rates for deposits and government bondsruling in excess of 21 years.

16.65 16.04 16.65 16.39 17.82 18.23 18.32 17.30


2014 2015

Customer Deposits (Ksh. Billion)


CAPITAL ADEQUACY RATIOS

A A

ABC Bank Performance Review

Our PBT without extra-ordinary items has been growing steadily from KShs 412m in 2010 to KShs 530m in 2013, KShs 522m in 2014, and KShs 527 in 2015. However, with extra-ordinary items our PBT grew from KShs 480m in 2010 to KShs 578m in 2013 and KShs 319m in 2014 and KShs 355m in 2015.

The 2014 PBT was attributed to strategic decisions that the Bank undertook which included but not limited to:

1. Aggressive investment in infrastructure and capacity building especially in ICT and recruitment

2. Prudent decision on adequate provisions amounting to KShs 132m for loans that showed signs of impairment following our continuous assessment of the loan book

3. Extraordinary expenses and extraordinary income which contributed to our PBT were mainly bond trading and loan recoveries. In 2010, we made KShs 127m in Bond trading while in 2014 we managed about KShs 20m attributed to the erratic nature of the bond market during that period.

4. Our expansion plan in terms of lending and capital adequacy. In mid 2014 we issued a bond in order to support this and the proceeds were initially invested in the money markets which were low yielding awaiting loans disbursements. The absorption of the proceeds mostly happened towards the end of the year while the interest expense begun to accrue from the issue date which amounted to KShs 82m by end year.


ABC Bank Performance Review


II PROFIT AND LOSS ACCOUNT 1.0 INTEREST INCOME1.1 Loans and advances 519,024 2,287,672 663,732 545,454 2,396,824 688,123 1.2 Government securities 121,035 470,251 104,021 136,860 527,048 115,128 1.3 Deposits and placements with banking institutions 1,139 3,706 11 3,349 25,030 13,972 1.4 Other Interest Income 7,085 25,699 2,610 7,085 25,699 2,625 1.5 Total interest income 648,283 2,787,328 770,374 692,748 2,974,601 819,848

2.0 INTEREST EXPENSE2.1 Customer deposits 293,129 1,323,055 454,705 297,777 1,344,269 459,880 2.2 Deposits and placement from banking institutions 6,378 97,941 32,881 7,038 94,399 32,701 2.3 Other interest expenses 41,322 164,051 38,028 41,322 164,051 38,028 2.4 Total interest expenses 340,829 1,585,047 525,614 346,137 1,602,719 530,609 3.0 NET INTEREST INCOME/(LOSS) 307,454 1,202,281 244,760 346,611 1,371,882 289,239

4.0 NON-INTEREST INCOME4.1 Fees and commissions on loans and advances 15,043 166,062 42,128 16,412 168,798 44,013 4.2 Other fees and commissions 51,953 155,333 34,102 63,830 186,819 41,037 4.3 Foreign exchange trading income/(Loss) 25,414 60,245 33,925 27,028 64,225 35,110 4.4 Dividend Income - - - - - - 4.5 Other income 1,601 8,781 (1,681) 5,247 43,080 2,006 4.6 Total Non-interest income 94,011 390,421 108,474 112,517 462,922 122,166 5.0 TOTAL OPERATING INCOME 401,465 1,592,702 353,234 459,128 1,834,804 411,405

6.0 OTHER OPERATING EXPENSES6.1 Loan loss provision 10,000 77,742 11,200 12,639 88,088 12,154 6.2 Staff costs 142,072 585,803 149,619 164,986 685,120 175,256 6.3 Directors' emoluments 13,359 58,188 14,365 13,359 59,770 14,428 6.4 Rental charges 15,033 69,172 16,793 21,098 94,398 23,956 6.5 Depreciation charge on property and equipment 17,832 62,018 13,888 19,777 69,970 15,740 6.6 Amortisation charges 2,617 16,258 4,227 2,706 16,650 4,331 6.7 Other operating expenses 91,252 368,095 31,409 107,845 432,409 46,023 6.8 Total Other Operating Expenses 292,165 1,237,276 241,501 342,410 1,446,405 291,888 7.0 Profit/(loss) Before Tax and Exceptional Items 109,300 355,426 111,733 116,718 388,399 119,517 8.0 Exceptional Items - - - 9.0 Profit/(Loss) After Exceptional Items 109,300 355,426 111,733 116,718 388,399 119,517

10.0 Current Tax 32,790 82,547 33,520 34,682 95,633 35,963 11.0 Deferred Tax 6,161 - 2,847 - 12.0 Profit/(Loss) After Tax and Exceptional Items 76,510 266,718 78,213 82,036 289,919 83,554 13.0 Minority Interest 2,512 10,357 2,873 14.0 Profit/(loss) after tax, exceptional items and Minority Interest 76,510 266,718 78,213 79,524 279,562 80,681 15.0 Other Comprehensive Income

15.1Gains/(Losses) from translating the financial statements of foreign operations (18,242) (76,917) (7,874)

15.2 Fair value changes in available for sale financial assets (10,188) (52,660) (18,231) (10,188) (30,347) (18,231)15.3 Revaluation surplus on Property,plant and equipment - - - 15.4 Share of other comprehensive income of associates - - - 15.5 Income tax relating to components of other comprehensive income - - - 16.0 Other Comprehensive Income for the year net of tax (10,188) (52,660) (18,231) (28,430) (107,264) (26,105)17.0 Total comprehensive income for the year 66,322 214,058 59,982 53,606 182,655 57,449 18.0 EARNINGS PER SHARE- BASIC & DILUTED 0.73 2.54 0.74 0.78 2.66 0.80 19.0 DIVIDEND PER SHARE -DECLARED

III OTHER DISCLOSURES1.0 NON-PERFORMING LOANS AND ADVANCES

(a) Gross Non-performing loans and advances 1,356,464 2,676,858 2,803,218 1,362,739 2,694,737 2,824,209 (b) Less: Interest in Suspense 337,536 513,773 530,130 337,987 514,280 531,719 (c)Total Non-Performing Loans and Advances (a-b) 1,018,928 2,163,085 2,273,088 1,024,752 2,180,457 2,292,490 (d) Less: Loan Loss Provision 181,094 195,996 195,304 183,663 202,720 201,422 (e) Net Non-Performing Loans and Advances(c-d) 837,834 1,967,089 2,077,784 841,089 1,977,737 2,091,068 (f) Discounted Value of Securities 837,834 1,967,089 2,077,784 841,089 1,977,737 2,091,068 (g) Net NPLs Exposure (e-f) - - - - - -

2.0 INSIDER LOANS AND ADVANCES (a) Directors, Shareholders and Associates 202,932 207,629 233,198 202,932 208,312 233,963 (b) Employees 244,891 362,059 388,362 244,891 362,742 389,127 (c)Total Insider Loans and Advances and other facilities 447,823 569,688 621,560 447,823 571,054 623,090

3.0 OFF-BALANCE SHEET ITEMS (a)Letters of credit,guarantees, acceptances 2,331,539 901,587 858,040 2,389,885 1,126,545 1,034,541 (b) Forwards, swaps and options 2,539,663 1,181,087 1,114,305 2,539,663 1,181,087 1,114,305 (c)Other contingent liabilities 290,576 56,414 99,910 290,576 56,414 99,910 (d)Total Contingent Liabilities 5,161,778 2,139,088 2,072,255 5,220,124 2,364,046 2,248,756

4.0 CAPITAL STRENGTH (a)Core capital 1,966,132 2,180,988 2,220,095 (b) Minimum Statutory Capital 1,000,000 1,000,000 1,000,000 (c)Excess/(Dificiency)(a-b) 966,132 1,180,988 1,220,095 (d) Supplementary Capital 967,987 830,818 780,818 (e) Total Capital (a+d) 2,934,119 3,011,806 3,000,913 (f)Total risk weighted assets 18,373,684 18,304,295 18,423,018 (g) Core Capital/Total deposits Liabilities 12.0% 13.8% 13.9% (h) Minimum statutory Ratio 8.0% 8.0% 8.0% (I) Excess/(Deficiency) (g-h) 4.0% 5.8% 5.9% (j) Core Capital / total risk weighted assets 10.7% 11.9% 12.1% (k) Minimum Statutory Ratio 10.5% 10.5% 10.5% (l) Excess (Deficiency) (j-k) 0.2% 1.4% 1.6% (m) Total Capital/total risk weighted assets 16.0% 16.5% 16.3% (n) Minimum statutory Ratio 14.5% 14.5% 14.5% (o) Excess/(Deficiency) (m-n) 1.5% 2.0% 1.8%

5 LIQUIDITY (a) Liquidity Ratio 33% 22% 25% (b) Minimum Statutory Ratio 20% 20% 20% (c) Excess (Deficiency) (a-b) 13% 2% 5%

The financial statements are extracts from the books of the institution. The complete set of quarterly financial statements, statutory and qualitative disclosures can be accessed on the institution’s website www.abcthebank.com. They may also be accessed at the institution’s head office located at ABC Bank House, Woodvale Grove, Westlands Nairobi. SIGNEDSHAMAZ SAVANI JOSEPH K.MUIRURIGROUP MANAGING DIRECTOR DIRECTOR

I BALANCE SHEET Bank Group 31st Mar

2015 31st Dec

2015 31st Mar

2016 31st Mar

2015 31st Dec

2015 31st Mar

2016 Unaudited Audited Unaudited Unaudited Audited Unaudited

Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ Shs ‘000’ A ASSETS

1 Cash ( both Local & Foreign) 172,123 181,083 176,534 198,790 224,355 221,456 2 Balances due from Central Bank of Kenya 692,915 903,947 1,192,352 744,289 1,006,547 1,307,144 3 Kenya Government and other securities held for dealing purposes - - - 4 Financial Assets at fair value through profit and loss - - - 5 Investment Securities: - - -

a) Held to Maturity: 4,346,728 3,398,545 2,900,091 4,922,935 3,848,018 3,297,451 a. Kenya Government securities 4,102,526 3,241,430 2,900,091 4,102,526 3,241,430 2,900,091 b. Other securities 244,202 157,115 - 820,409 606,588 397,360 b) Available for sale: 829,158 499,621 480,881 829,158 499,621 480,881 a. Kenya Government securities 829,158 499,621 480,881 829,158 499,621 480,881 b. Other securities - - -

6 Deposits and balances due from local banking institutions 80,977 91,784 82,963 90,187 98,937 95,333 7 Deposits and balances due from banking institutions abroad 198,098 31,481 145,324 349,055 343,715 480,108 8 Tax recoverable 80,302 20,655 20,655 94,354 35,038 34,777 9 Loans and advances to customers (net) 12,945,731 14,828,522 14,062,190 13,501,549 15,292,071 14,518,774

10 Balances due from banking institutions in the group 10,579 11,479 12,112 - - - 11 Investments in associates - - - 12 Investments in subsidiary companies 885,405 885,405 885,405 13 Investments in joint ventures - - - 14 Investment properties - - - 15 Property and equipment 525,726 498,770 527,216 564,607 532,416 558,792 16 Prepaid lease rentals - - - 17 Intangible assets 138,636 132,362 128,134 139,022 132,719 128,385 18 Deferred tax asset 31,501 25,440 25,440 33,125 29,943 30,046 19 Retirement benefit asset - - - 20 Other assets 869,986 549,203 1,088,356 976,146 574,364 1,138,960 21 TOTAL ASSETS 21,807,865 22,058,297 21,727,653 22,443,217 22,617,744 22,292,107

B LIABILITIES

22 Balances due to Central Bank of Kenya - 1,098,624 838,402 - 1,098,624 838,402 23 Customer deposits 16,451,190 15,774,465 15,995,342 16,816,733 16,300,473 16,485,489 24 Deposits and balances due to local banking institutions 510,117 370,229 101,449 510,117 370,229 101,449 25 Deposits and balances due to foreign banking institutions 148,423 184,213 196,942 148,423 - 24,387 26 Other money market deposits - - - 27 Borrowed funds 1,494,354 1,404,578 1,350,014 1,494,354 1,404,578 1,350,014 28 Balances due to banking institutions in the group - - - 29 Tax payable 32,790 - 33,520 36,427 - 38,068 30 Dividends payable31 Deferred tax liability - - - - - - 32 Retirement benefit liability - - - 33 Other liabilities 482,118 389,580 315,394 569,343 413,454 368,767 34 TOTAL LIABILITIES 19,118,992 19,221,689 18,831,063 19,575,397 19,587,358 19,206,576

C SHAREHOLDERS’ FUNDS35 Paid up /Assigned capital 1,050,000 1,050,000 1,050,000 1,050,000 1,050,000 1,050,000 36 Share premium/(discount) - - - 37 Revaluation reserves (18,436) (60,908) (79,139) (122,011) (136,555) (154,786)38 Retained earnings/Accumulated losses 1,557,100 1,733,365 1,811,578 1,561,652 1,742,052 1,822,733 39 Statutory loan loss reserves 100,209 114,151 114,151 105,767 120,957 118,717 40 Other Reserves (11,183) (30,322) (38,260)41 Proposed dividends - - - 42 Capital grants43 TOTAL SHAREHOLDERS' FUNDS 2,688,873 2,836,608 2,896,590 2,584,225 2,746,132 2,798,404 44 Minority Interest 283,595 284,254 287,127 45 TOTAL LIABILITIES AND SHAREHOLDERS' FUNDS 21,807,865 22,058,297 21,727,653 22,443,217 22,617,744 22,292,107

- - - - - - II PROFIT AND LOSS ACCOUNT

1.0 INTEREST INCOME1.1 Loans and advances 519,024 2,287,672 663,732 545,454 2,396,824 688,123 1.2 Government securities 121,035 470,251 104,021 136,860 527,048 115,128 1.3 Deposits and placements with banking institutions 1,139 3,706 11 3,349 25,030 13,972 1.4 Other Interest Income 7,085 25,699 2,610 7,085 25,699 2,625 1.5 Total interest income 648,283 2,787,328 770,374 692,748 2,974,601 819,848

2.0 INTEREST EXPENSE2.1 Customer deposits 293,129 1,323,055 454,705 297,777 1,344,269 459,880 2.2 Deposits and placement from banking institutions 6,378 97,941 32,881 7,038 94,399 32,701 2.3 Other interest expenses 41,322 164,051 38,028 41,322 164,051 38,028 2.4 Total interest expenses 340,829 1,585,047 525,614 346,137 1,602,719 530,609 3.0 NET INTEREST INCOME/(LOSS) 307,454 1,202,281 244,760 346,611 1,371,882 289,239

4.0 NON-INTEREST INCOME4.1 Fees and commissions on loans and advances 15,043 166,062 42,128 16,412 168,798 44,013 4.2 Other fees and commissions 51,953 155,333 34,102 63,830 186,819 41,037 4.3 Foreign exchange trading income/(Loss) 25,414 60,245 33,925 27,028 64,225 35,110 4.4 Dividend Income - - - - - - 4.5 Other income 1,601 8,781 (1,681) 5,247 43,080 2,006 4.6 Total Non-interest income 94,011 390,421 108,474 112,517 462,922 122,166 5.0 TOTAL OPERATING INCOME 401,465 1,592,702 353,234 459,128 1,834,804 411,405

QUARTERLY FINANCIAL STATEMENTS AND OTHER DISCLOSURES AS AT 31ST MARCH 2016

Our Branch Network


•

Koinange Street Branch - Koinange Street, NairobiWestlands Branch - ABC Bank House, Woodvale GroveLibra House Branch - Libra House, Mombasa RoadIndustrial Area Branch - ABC Bank Building, Dar es Salaam RoadTRM Branch - Thika Road Mall, Thika Super HighwayGreen House Branch - Green House Mall, Ngong Road

Mombasa Branch - Shariff Nasser Investment Building, Moi AvenueLamu Branch - Seafront, Lamu TownMeru Branch - Moi Avenue, MeruNakuru Branch - Saifee House, Kenyatta Avenue, NakuruEldoret Branch - Zul Arcade, Odinga Oginga Road EldoretKisumu Branch - Jubilee House, Odinga Oginga Road, KIsumu

ABC Capital Ltd - IPS Building, 5th Flr. Kimathi StreetABC Insurance Brokers Ltd - ABC Bank House, WestlandsABC Capital Bank Uganda - Plot 4 Pilkington Rd, Colline House

Head Office - ABC Bank House, Woodvale Grove, Westlands Nairobi

•

KENYA

Lamu

Group Companies

Nairobi Branches

Upcountry Branches

Colline Branch • Luwum Street Branch • Kikuubo Branch • Arua Park Branch

Why Choose ABC Bank as the preferred Banking Partner


• ABC Bank is a stable Bank having being in existence for over 30 years with a strong balance sheet and consistent profitability

• The Global Credit Rating Company (GCR) recently upgraded the Bank’s rating of national scale short term A2 (KE) and

long term BBB (KE) with the outlook accorded as stable

• We have strategic locations in all major towns in Kenya and a presence in Uganda

• Our operations benefit the immediate environment and the people who live in it through our CSR activities

• We have a wide array of personal and business banking products and services to suit your individual or business financial

needs

• ABC Bank is the niche Bank in Alternative Banking channels.

• We have won the champions of governance award repeatedly over the years

• We have strong Correspondent Banking relationships in Africa, Europe, Asia and USA

• At ABC Bank, we pride ourselves of a good working culture and a complementary mix of skill sets and expertise

• We offer you personalized services

• ABC Bank is ISO 9001:2008 certified

• An award winner for product innovation

• Wide network of agents all over Kenya and robust Sacco relationships

• Loyal customers of over two decades

• A strong, stable and clean bank, with a healthy track record of growth and profit

www.abcthebank.com

UGANDA

KENYA

Lamu

Mombasa

0701 700 700 I [email protected] I www.facebook.com/abcthebank I www.abcthebank.com

african banking corporation - abc bank | achieve the ... in 2016: • thika road mall (trm) •...

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