Diamond Trust Bank Group released their FY’22 earnings results posting a 55.08% climb in EPS & PAT to KES 21.68/share and KES 6.06Bn respectively driven by a 14.48% increase in net interest income and a 45.08% growth in non-interest income. Trailing ROaE & ROaA improved to 9.97% & 1.38% respectively in FY’22. NIMs remained adequate at 5.28% while the profit margin edged up 445bps y/y to 21.27%. In line with our expectation, the board of directors recommended a first and final dividend of KES 5.00 in FY’22 representing a 66.67% increase from KES 3.00 paid out in FY’21. The book closure of the dividends is set for 12th May 2023 while payment date is set for 15th June 2023.

Loan book grew 15.08% y/y to KES 253.67Bn slower than the 16.93% y/y growth in the customer deposits to KES 387.56Bn leading to a 105bps decline in the loan deposit ratio to 65.45%. Allocation to government securities edged up 11.15% y/y to 187.82Bn in driven by hunt for higher yields. The lender increased its borrowings by 26.48% year over year to KES 25.52Bn from KES 20.17Bn, which we suspect is being used for CAPEX requirements to fund branch development projects they started in July 2022 to boost DTB's presence in East Africa to over 150 branches by the end of the year.