Achieve More

The Board of Directors of Diamond Trust Bank Kenya Limited is pleased to announce the audited Group and Bank results for the year ended 31st December 2017
GROUP BANK GROUP BANK
Dec. 2017 Dec 2016 Dec. 2017 Dec. 2016 Dec. 2017 Dec 2016 Dec. 2017 Dec. 2016
STATEMENT OF FINANCIAL POSITION Shs 000 Shs 000 Shs 000 Shs 000 STATEMENT OF COMPREHENSIVE INCOME Shs 000 Shs 000 Shs 000 Shs 000
Audited Audited Audited Audited Audited Audited Audited Audited
ASSETS INTEREST INCOME
Cash (both local and foreign) 7,632,063 5,903,563 4,888,042 3,940,380 Loans and advances 22,651,861 23,917,030 16,834,004 17,405,707
Balances due from Central Banks 17,376,788 2 1,576,765 10,162,149 10,988,072 Government securities 11,744,676 9,598,968 8,694,690 7,203,226
Kenya Government and other securities held for dealing purposes - - - - Deposits and placements with banking institutions 232,253 296,878 101,556 188,472
Investment Securities: Other interest income - - 3,143 6,534
(a) Held to Maturity: Total interest income 34,628,790 33,812,876 25,633,393 24,803,939
a. Kenya Government securities 84,895,740 74,311,860 84,895,740 74,311,860 INTEREST EXPENSES
b. Other securities 27,642,068 18,264,185 - - Customer deposits 13,497,804 12,942,194 10,659,671 9,777,307
(b) At Fair Value: Deposits and placements from banking institutions 490,587 415,631 481,658 352,496
a. Kenya Government securities 15,474 201,941 15,474 201,941 Other interest expenses 965,321 1,069,774 754,968 879,123
b. Other securities 1,797,617 - 1,797,617 - Total interest expenses 14,953,712 14,427,599 11,896,297 11,008,926
Deposits and balances due from local banking institutions 34,925 177,739 34,925 177,739 NET INTEREST INCOME 19,675,078 19,385,277 13,737,096 13,795,013
Deposits and balances due from banking institutions abroad 12,481,446 7,433,398 2,875,544 2,709,194 OTHER OPERATING INCOME
Income tax recoverable 829,434 121,468 652,699 - Fees and commissions on loans and advances 1,261,206 1,096,734 907,841 723,036
Loans and advances to customers (net) 196,048,155 186,303,191 148,515,793 136,685,924 Other fees and commissions income 1,995,208 1,994,332 994,545 892,328
Balances due from group companies - - - 114,060
Foreign exchange trading income 1,596,970 1,745,734 1,039,379 1,266,222
Investments in associate 35,462 28,616 1 1
Dividend income - - 68,704 58,076
Investment in subsidiary companies - - 5,600,405 4,544,025
Other income 422,025 231,937 155,876 137,619
Investments in joint ventures - - - -
Investment properties - - - - Total non-interest income 5,275,409 5,068,737 3,166,345 3,077,281
Property and equipment 6,716,249 6,738,194 5,020,237 5,072,986 TOTAL OPERATING INCOME 24,950,487 24,454,014 16,903,441 16,872,294
Prepaid lease rentals - - - - OPERATING EXPENSES
Intangible assets 1,327,057 1,283,008 1,072,640 979,459 Loan loss provision 4,300,777 4,269,537 2,680,290 2,820,657
Goodwill 173,372 173,372 - - Staff costs 3,976,009 3,356,651 2,386,223 1,908,622
Deferred tax asset 3,745,935 2,639,217 2,893,916 2,242,582 Directors' emoluments 115,714 113,085 67,035 65,827
Retirement benefit asset - - - - Rentals charges 798,382 692,307 385,090 317,646
Other assets 2,551,615 2,887,984 1,656,356 2,155,595 Depreciation charge on property and equipment 982,200 883,552 570,146 528,585
Total Assets 363,303,400 328,044,501 270,081,538 244,123,818 Amortisation charges 354,847 269,211 222,187 176,433
LIABILITIES Other operating expenses 4,332,713 3,880,463 2,364,912 2,178,139
Balances due to Central Bank of Kenya - - - - Total operating expenses 14,860,642 13,464,806 8,675,883 7,995,909
Customer deposits 266,246,854 238,103,640 190,468,570 169,599,903 PROFIT BEFORE TAX AND EXCEPTIONAL ITEMS 10,089,845 10,989,208 8,227,558 8,876,385
Deposits and balances due to local banking institutions 11,792,569 8,429,645 11,792,569 8,429,645
Exceptional items - - - -
Deposits and balances due to banking institutions abroad 8,711,424 9,146,157 6,993,117 7,717,579
Profit after exceptional items 10,089,845 10,989,208 8,227,558 8,876,385
Other money market deposits - - - -
Borrowed funds 17,174,934 22,062,229 13,562,268 18,824,605 Share of associate profit after tax 8,390 6,488 - -
Balances due to group companies - - - - Profit before tax 10,098,235 10,995,696 8,227,558 8,876,385
Current income tax payable - 695,434 - 681,444 Current tax (4,198,225) (4,238,206) (3,303,339) (3,590,394)
Dividends payable - - - - Deferred tax credit 1,025,030 970,650 575,452 865,912
Deferred income tax liability - - - - PROFIT AFTER TAX AND EXCEPTIONAL ITEMS 6,925,040 7,728,140 5,499,671 6,151,903
Retirement benefit liability - - - - Non controlling interests 475,229 554,201 - -
Other liabilities 5,757,864 3,730,847 4,261,042 2,438,833 Profit for the period after tax and non controlling interests 6,449,811 7,173,939 5,499,671 6,151,903
Total Liabilities 309,683,645 282,167,952 227,077,566 207,692,009 Other comprehensive income
SHAREHOLDERS' EQUITY Gain/(loss) from translating the financial statements of foreign
Paid-up capital 1,118,409 1,065,284 1,118,409 1,065,284 operations 194,166 (687,383) - -
Share premium 9,006,569 7,294,767 9,006,569 7,294,767 (Loss)/gain on revaluation of land and buildings (12,712) 1,202,512 - 1,075,810
Revaluation reserve 226,088 433,325 1,357,296 1,386,184 Income tax relating to these items 5,826 (91,801) - (53,791)
Retained earnings 35,934,013 30,682,722 30,794,732 25,993,139 Other comprehensive income for the year net of tax 187,280 423,328 - 1,022,019
Statutory loan loss reserve 1,357,750 860,779 - - TOTAL COMPREHENSIVE INCOME FOR THE YEAR 7,112,320 8,151,468 5,499,671 7,173,922
Proposed dividends 726,966 692,435 726,966 692,435
Capital grants - - - - Earnings per Share (Shs per share) - basic and diluted 23.73 26.94 20.23 23.10
Total Shareholders' Equity 48,369,795 41,029,312 43,003,972 36,431,809 Dividend per Share (Shs per share) 2.60 2.60 2.60 2.60
Non controlling interests 5,249,960 4,847,237 - -
Total Equity 53,619,755 45,876,549 43,003,972 36,431,809
Total Liabilities and Shareholders' Equity 363,303,400 328,044,501 270,081,538 244,123,818 ANNUAL GENERAL MEETING AND DECLARATION OF DIVIDEND
OTHER DISCLOSURES Based on the year-end results achieved, the Directors will recommend to the Shareholders at the
(1) NON -PERFORMING LOANS AND ADVANCES Annual General Meeting to be held at Laico Regency Hotel, Crystal Ballroom, Nairobi, on 24 May
(a) Gross non-performing loans and advances 14,833,944 7,523,969 11,901,308 5,519,836 2018, payment of a first and final dividend of 65% (i.e. at the rate of Shs 2.60 per share) for the
(b) Interest in suspense 1,783,544 1,471,145 1,303,560 1,033,069
year 2017 on the issued and paid-up share capital of Shs 1,118,408,880, subject to withholding
(c) Total Non-Performing Loans and Advances (a-b) 13,050,400 6,052,824 10,597,748 4,486,767
(d) Loan loss provisions 8,233,546 4,968,968 7,023,575 3,983,289
tax, where applicable.
(e) Net non-performing loans (c-d) 4,816,854 1,083,856 3,574,173 503,478
(f) Discounted value of securities 4,816,854 1,083,856 3,574,173 503,478 For purposes of payment of the dividend, the Share Register of the Bank will be closed on 25 May
(g) Net NPLs Exposure (e-f) - - - - 2018 and payment of dividend due to Shareholders on the Register as at the close of business on
(2) INSIDER LOANS AND ADVANCES 25 May 2018, will be made from 25 June 2018.
(a) Directors, shareholders and associates 3,007,298 3,461,872 2,616,943 2,878,981
(b) Employees 1,574,884 1,506,188 1,273,982 1,229,294
By order of the Board
(c) Total Insider Loans and Advances 4,582,182 4,968,060 3,890,925 4,108,275
(3) OFF-BALANCE SHEET ITEMS
Stephen Kodumbe
(a) Letters of credit, guarantees, acceptances 32,196,173 23,633,162 27,478,167 19,962,567
Company Secretary
(b) Forwards, swaps and options 5,500,003 6,938,248 4,235,970 5,461,719 23 March 2018
(c) Other contingent liabilities - - - -
(d) Total contingent liabilities 37,696,176 30,571,410 31,714,137 25,424,286
(4) CAPITAL STRENGTH
(a) Core capital 35,343,675 29,720,081 MESSAGE FROM DIRECTORS
(b) Minimum statutory capital 1,000,000 1,000,000
(c) Excess/(deficiency) 34,343,675 28,720,081 These financial statements are extracts from the books of the institution as audited by KPMG,
(d) Supplementary capital 3,446,708 4,184,118 Kenya and received an unqualified opinion.
(e) Total capital (a+d) 38,790,383 33,904,199
(f) Total risk weighted assets 204,038,635 183,222,771
(g) Core capital/total deposit liabilities 18.5% 17.4%
The complete set of these financial statements will be available at our registered office at DTB
(h) Minimum statutory ratio 8.0% 8.0% Centre Mombasa Road and online at www.dtbafrica.com for inspection after approval at the
(i) Excess/(deficiency) (g-h) 10.5% 9.4% Annual General Meeting to be held on 24 May 2018.
(j) Core capital/total risk weighted assets 17.3% 16.2%
(k) Minimum statutory ratio 10.5% 10.5%
(l) Excess/(deficiency) (j-k) 6.8% 5.7% Abdul Samji Chairman
(m) Total capital/total risk weighted assets 19.0% 18.5% Nasim Devji Managing Director
(n) Minimum statutory ratio 14.5% 14.5% Ismail Mawji Director
(o) Excess/(deficiency) (m-n) 4.5% 4.0%
Stephen Kodumbe Company Secretary
(5) LIQUIDITY
(a) Liquidity ratio 49.9% 50.2%
(b) Minimum statutory ratio 20.0% 20.0%
(c) Excess/(deficiency) (a-b) 29.9% 30.2%
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2016
Attributable
Statutory to equity Non
Share Share loan losss Other Retained Proposed holders of controlling
capital premium reserve reserves earnings dividend the Bank interests Total
Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000

At start of year 968,440 7,294,767 - (27,970) 25,293,925 605,275 34,134,437 4,170,951 38,305,388

Profit for the year - - - - 7,173,939 - 7,173,939 554,201 7,728,140

Other comprehensive income - - - 585,994 - - 585,994 (162,666) 423,328
Transfer of excess depreciation - - - (6,518) 6,518 - - - -
Deferred tax on transfer of excess depreciation - - - 1,248 (1,248) - - - -
Statutory loan loss reserve - - 860,779 - (860,779) - - - -
Legal reserve - - - 7,313 (7,313)
Total comprehensive income - - 860,779 588,037 6,311,117 - 7,759,933 391,535 8,151,468
Transactions with owners in their capacity
as owners:
Bonus issue 96,844 - - - (96,844) - - - -
Issue of additional shares to non controlling
interests - - - - - - - 505,584 505,584
Acquisition of interests from non controlling
interests in Diamond Trust Bank Uganda
Limited. - - - (126,742) - - (126,742) (186,244) (312,986)
Unclaimed dividends previously written back
to reserves surrendered to the Unclaimed
Financial Assets Authority - - - - (133,041) - (133,041) - (133,041)
Dividends: -
- Final for 2015 paid - - - - - (605,275) (605,275) (34,589) (639,864)
- Proposed for 2016 - - - - (692,435) 692,435 - - -
Total transactions with owners,
recognised directly in equity 96,844 - - (126,742) (922,320) 87,160 (865,058) 284,751 (580,307)
At end of year 1,065,284 7,294,767 860,779 433,325 30,682,722 692,435 41,029,312 4,847,237 45,876,549

AN EXTRACT FROM DTB FINANCIAL STATEMENTS 2017 | 1

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2017
Attributable
Statutory to equity Non
Share Share loan losss Other Retained Proposed holders of controlling
capital premium reserve reserves earnings dividend the Bank interests Total
Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000

At start of year 1,065,284 7,294,767 860,779 433,325 30,682,722 692,435 41,029,312 4,847,237 45,876,549

Profit for the year - - - - 6,449,811 - 6,449,811 475,229 6,925,040

Other comprehensive income - - - (90,182) - - (90,182) 277,462 187,280
Transfer of excess depreciation - - - (33,448) 33,448 - - - -
Deferred tax on transfer of excess depreciation - - - 1,520 (1,520) - - - -
Statutory loan loss reserve - - 496,971 - (496,971) - - - -
Legal reserve - - - 6,511 (6,511)
Total comprehensive income - - 496,971 (115,599) 5,978,257 - 6,359,629 752,691 7,112,320
Transactions with owners in their capacity as
owners:
Issue of shares on acquisition of HBL Kenya assets
and liabilities 53,125 1,711,802 - - - - 1,764,927 - 1,764,927
Acquisition of interests from non controlling
interests in Diamond Trust Bank Uganda Limited. - - - (91,638) - - (91,638) (309,275) (400,913)
Dividends: -
- Final for 2016 paid - - - - - (692,435) (692,435) (40,693) (733,128)
- Proposed for 2017 - - - - (726,966) 726,966 - - -
Total transactions with owners, recognised
directly in equity 53,125 1,711,802 - (91,638) (726,966) 34,531 980,854 (349,968) 630,886

At end of year 1,118,409 9,006,569 1,357,750 226,088 35,934,013 726,966 48,369,795 5,249,960 53,619,755

AN EXTRACT FROM DTB FINANCIAL STATEMENTS 2017 | 2

BANK STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2016

Share Share Other Retained Proposed

capital premium reserves earnings dividend Total
Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000

At start of year 968,440 7,294,767 366,854 20,760,865 605,275 29,996,201

Profit for the year - - - 6,151,905 - 6,151,905

Other comprehensive income - - 1,022,019 - 1,022,019
Transfer of excess depreciation - - (2,831) 2,831 - -
Deferred tax on transfer of excess depreciation - - 142 (142) - -
Total comprehensive income - - 1,019,330 6,154,594 - 7,173,924

Transactions with owners in their capacity as owners:

Bonus issue 96,844 - - (96,844) - -
Unclaimed dividends previously written back to reserves surrendered
to the Unclaimed Financial Assets Authority - - - (133,041) - (133,041)
Dividends:
- Final for 2015 paid - - - - (605,275) (605,275)
- Proposed for 2016 - - - (692,435) 692,435 -
Total transactions with owners, recognised directly in equity 96,844 - - (922,320) 87,160 (738,316)
At end of year 1,065,284 7,294,767 1,386,184 25,993,139 692,435 36,431,809

AN EXTRACT FROM DTB FINANCIAL STATEMENTS 2017 | 3

BANK STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2017

Share Share Other Retained Proposed

capital premium reserves earnings dividend Total
Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000

At start of year 1,065,284 7,294,767 1,386,184 25,993,139 692,435 36,431,809

Profit for the year - - - 5,499,671 - 5,499,671

Other comprehensive income - - - - - -
Transfer of excess depreciation - - (30,408) 30,408 - -
Deferred tax on transfer of excess depreciation - - 1,520 (1,520) - -
Total comprehensive income - - (28,888) 5,528,559 - 5,499,671

Transactions with owners in their capacity as owners:

Issue of shares on acquisition of HBL Kenya assets and liabilities 53,125 1,711,802 - - - 1,764,927
Dividends:
- Final for 2016 paid - - - - (692,435) (692,435)
- Proposed for 2017 - - - (726,966) 726,966 -
Total transactions with owners, recognised directly in equity 53,125 1,711,802 - (726,966) 34,531 1,072,492

At end of year 1,118,409 9,006,569 1,357,296 30,794,732 726,966 43,003,972

AN EXTRACT FROM DTB FINANCIAL STATEMENTS 2017 | 4

 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2017
Group Bank
2017 2016 2017 2016
Shs’000 Shs’000 Shs’000 Shs’000
Cash flows from/( used in) operating activities
Interest receipts 34,860,913 30,179,707 25,838,674 21,504,053
Interest payments (13,978,997) (12,274,604) (11,184,103) (9,129,020)
Net fee and commission receipts 3,140,739 3,091,066 1,784,618 1,682,036
Other income received 1,914,316 1,901,622 1,232,537 1,334,166
Recoveries from loans previously written off 150,079 72,195 20,221 13,305

Payments to employees and suppliers (8,872,466) (7,800,888) (5,191,184) (4,470,233)

Income tax paid (5,601,625) (3,949,992) (4,637,482) (3,148,222)
Cash flows from operating activities before changes
in operating assets and liabilities 11,612,959 11,219,106 7,863,282 7,786,085
Changes in operating assets and liabilities:
- cash reserve requirement (795,224) (2,320,502) (1,066,589) (2,117,086)
- Government securities (19,040,677) (42,022,834) (10,961,562) (37,043,922)
- loans and advances to customers (12,517,541) (12,699,975) (13,274,993) (13,546,501)
- Balances due from subsidiary companies - - 113,857 113,589
- customer deposits 20,764,779 43,457,323 13,324,513 42,370,414
- other assets 492,619 (412,125) 656,952 (321,482)
- other liabilities 1,868,011 (680,459) 1,719,699 (818,850)
Net cash from/(used in) operating activities 2,384,927 (3,459,467) (1,624,841) (3,577,753)
Cash flows used in investing activities
Purchase of property and equipment (965,191) (1,388,113) (458,109) (891,102)
Purchase of intangible assets - software costs (400,647) (441,788) (327,654) (410,424)
Purchase of shares via rights issues - - (1,056,380) (1,151,558)
Net proceeds from sale of Government securities (878) (10,531) (878) (10,531)
Proceeds from sale of property and equipment 9,102 2,662 2,762 1,355
Dividend received - - 68,704 58,076
Net cash used in investing activities (1,357,614) (1,837,770) (1,771,555) (2,404,184)
Cash flows used in financing activities
Proceeds from borrowings 379,682 10,301,532 - 10,279,284
Repayment of borrowings (5,430,160) (14,658,886) (5,258,898) (14,499,774)
Finance costs (964,378) (936,736) (758,407) (910,660)
Proceeds from additional shares issued to NCI - 505,584 - -
Unclaimed dividends surrendered to UFAA - (133,041) - (133,041)
Dividends paid to equity holders of the bank (692,435) (605,275) (692,435) (605,275)
Dividends paid to non controlling interests (40,693) (34,589) - -
Net cash from financing activities (6,747,984) (5,561,411) (6,709,740) (5,869,466)
Net decrease in cash and cash equivalents (5,720,671) (10,858,648) (10,106,136) (11,851,403)
Cash and cash equivalents at start of year 2,865,866 15,269,755 (7,097,656) 4,753,747
Cash and cash equivalents acquired from HBL 6,546,360 - 6,546,360 -
Translation difference (901,629) (1,545,241) - -
8,510,597 13,724,514 (551,296) 4,753,747
Cash and cash equivalents at end of year 2,789,926 2,865,866 (10,657,432) (7,097,656)

AN EXTRACT FROM DTB FINANCIAL STATEMENTS 2017 | 5