* CEO says plans are in place to ride out coronavirus storm
* Bank posted 7.5% rise in annual pretax profit
* Shares drop 4.5%, in line with broader index (Recasts, adds quotes)
By Duncan Miriri
NAIROBI, March 12 (Reuters) - Kenya’s top lender by assets, KCB Group, will seek to cushion customers from the effects of supply chain disruption, it said on Thursday after posting higher full-year profit while warning of earnings pressure from the coronavirus pandemic.
East Africa has yet to report any COVID-19 cases, but many small and large businesses that depend on China and Asia for imports of manufactured goods are already feeling the effects of delays caused by the outbreak.
“The disruption of the supply chain is one of the bigger risks ... We are already seeing notices that time lines will not be met,” KCB Chief Executive Joshua Oigara told an investor briefing.
Kenya is also likely to experience a slowdown in tourism, a key source of hard currency and jobs.
Group Chairman Andrew Kairu said: “We will only know the real impact in the coming weeks and months ... We will then project accordingly.”
In the meantime, the lender has a plan in place to help its borrowers to ride out the storm, CEO Oigara said.
“The banks will work with the customers that we have to address the supply challenges and the impact on their (loan) facilities. We have already prepared ourselves for that,” he said.
KCB, which also operates in neighbouring Uganda, Tanzania, Rwanda, Burundi and South Sudan, reported 2019 pretax profit up 7.5% at 36.73 billion shillings ($358.7 million).
A revaluation of its assets in South Sudan, which is required because of hyperinflation, further boosted earnings through a paper gain of 164 million shillings, the company said, increasing annual profit growth to 9%.
Lending via mobile phones grew 290% last year to a total of 212 billion shillings, KCB said, supporting faster growth in net interest income and transaction fees. The loans are offered via Safaricom’s M-Pesa financial services platform.
Earnings per share rose to 8.11 shillings from 7.83 shillings a year earlier, with the company keeping its total dividend at 3.50 shillings per share.
KCB shares dropped 4.5% after the results, in line with broader falls on the Nairobi bourse, mainly owing to the coronavirus-related turmoil in global financial markets. ($1 = 102.4000 Kenyan shillings) (Reporting by Duncan Miriri Editing by David Goodman)