Housing Finance group Branch. [Photo/businessdaily.co.ke]
Mortgage lender Housing Finance (HF) Group has said that it is likely to make total loss of 25% for the year ended 31st December 2017 as a result of interest rate caps and the prolonged electioneering period.
The NSE listed company profits for the nine months to September had already dropped by 81% to sh. 150.7 million, attributing this poor performance to defaulters of the mortgages.
In a statement to newsrooms on Thursday, the HF declares that it is going to make a reduced return on its investment for the last period of the just concluded 2017.
“HF Group Plc. projects that the net earnings for the year ended 31st December 2017 will be potentially 25 per cent lower than that reported for the year ended 31st December 2016,” the statement reads in part.
The company also blames slow processing of transactions in the Ministry of Lands which has resulted in slow liquidation of some of its project loans.
In the previous year, the mortgage financier reported a net profit of sh.905.8 million. The firm has joined a growing list of companies that have issued profit warnings including Bamburi Cement setting stage for investors’ potential dividend cuts.