KMRC disburses Ksh.1.3 billion mortgage loans in debut year

In new disclosures covering the financial year ended December 31, 2021, the company says it processed loan applications from 12 primary mortgage lenders and subsequently disbursed the sum of Ksh.1.3 billion to seven lenders.

The lenders include Housing Finance, Tower Sacco, Stima Sacco, Unaitas Sacco, Credit Bank, Co-operative Bank and Ukulima Sacco.

Kenya’s second largest bank by asset base KCB Bank Kenya was however conspicuously missing from the recipients list despite being at the fore-front of formation of KMRC.

The disbursements made in KMRC’s debut year fall shy of the Ksh.2.7 billion loan order book disclosed by the firm in December 2020 out of which KCB was to take the largest share at Ksh.2.1 billion.

The lack-lustre disbursements by the refinancier can however be traced to the low demand for mortgage loans on the backdrop of the advent of the COVID-19 pandemic in March 2020.

“Just like other financial institutions across the globe, KMRC had to contend with the effects of the COVID-19 pandemic on its business. The demand for financial services, particularly home loans has been impacted negatively as a result of the slowdown of economic activities and declining disposable income of individuals in 2020,” KMRC stated in the breakdown of its 2021 financial performance.

Aside from its disbursements, the KMRC received additional funding from the World Bank, the African Development Bank (AfDB) and the National Treasury in the form of subordinated debt and credit lines.

At the end of 2021, the company's borrowings stood at Ksh.6.8 billion from Ksh.3.7 billion in December 2020.

During the year, KMRC’s net profit rose by 155 per cent to Ksh.196.6 million from Ksh.77.2 million previously on rising interest income on the back of the start of disbursements on the mortgage backing loans.

KMRC now has an asset base of Ksh.9.8 billion including the new Ksh.1.3 billion.

Last month, KMRC issued the first trance of its Ksh.10.4 billion medium term notes (MTN) raising Ksh.1.4 billion the process from which proceeds will go into diversifying its funding base.

The board of KMRC has not recommended the payment of a final dividend for the period.