HF Group of Kenya’s full-year income rose by almost a quarter as its diversification into businesses such as property development started to pay off, Managing Director Frank Ireri said.
Income increased by 23 percent to 1.2 billion shillings ($11.8 million), the first time the lender has breached the billion mark, after net interest income climbed by a fifth to 3 billion shillings.
“We realized if we just stay focused on mortgage finance we were going to get very challenged,” Ireri said Thursday at a results presentation in the capital, Nairobi. “Forty percent of our loan sales last year were non-mortgage related.”
HF Group shares climbed 5 percent to 21 shillings by 11:54 a.m. in Nairobi.
The company halved its dividend pay out to 0.65 shillings per share to help finance plans to develop 10,000 houses by 2017, Ireri said. HF will begin building 1,500 homes along Nairobi’s Thika highway this year and start the second phase of its 1,200-unit Komarock property.
While it has the regulatory green-light to issue bonds of as much as 20 billion shillings, Ireri said the company would delay those plans until the interest-rate environment was more favorable. “If the government’s five-year bond is about 15 percent, what will investors expect from our bond?” he said.