Kuda Group, which owns Kuda Microfinance Bank Limited reported a loss of 25.227 million pounds (N13.18 billion) for the financial year ended 31 December 2022, on total income of 8.143 million pounds.

“The wider loss in 2022 is due to the increase in staff costs and other operating expense, relative to revenue as the company successfully scales,” Kuda said in its financials seen by MoneyCentral.

As at 31 December 2022, the Group had total assets of 120.6 million pounds (N63 billion), up from 92.46 million pounds (N48.33 billion) in 2021. Kuda Microfinance Bank Limited’s total assets were 94.2 million pounds (N49.24 billion), representing over 79% of the Group’s total assets as at 31 December 2022.

Kuda Microfinance Bank Limited (Kuda MFB), operates a digital-only bank, providing retail banking services. Kuda MFB had 4.9m registered users on the Kuda App at the end of 2022, compared to 2.4m in 2021.

The Group revenue is made up of a combination of fees and commissions charged for its products as well as interest income on its loans. This grew by 886% despite a year-on-year devaluation of the Naira in 2022.

Kuda MFB fined N100 million by CBN

Kuda Group’s subsidiary, Kuda Microfinance Bank Limited, was fined the sum of 191,306 ponds (N100 million) in 2022. The penalty was as a result of the examination carried out by the Central Bank of Nigeria (CBN) and the infractions noted were around loss levels, corporate governance and other compliance matters, according to Kuda.

Auditor issues disclaimer
A notable issue about the FY 2022 Kuda accounts seen by MoneyCentral was that the auditor KLSA LLP issued a disclaimer on the statement of accounts.

“We were unable to obtain sufficient appropriate audit evidence about the financial information of a significant subsidiary, Kuda Microfinance Bank Limited, which is included in the consolidated financial statements, and whose total assets were 94.2 million pounds, which represents 79% of the Group’s total assets. The financial statements of Kuda Microfinance Bank Limited were audited by another auditor whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Kuda Microfinance Bank Limited, is based solely on the report of the other auditor. We have not been able to obtain the necessary confirmation or other appropriate audit evidence to satisfy ourselves as to the carrying value of Kuda Microfinance Bank Limited’s assets and liabilities at 31 December 2022,” Ketan Shah, a Senior Statutory Auditor for KLSA LLP said.

Credit: Eaglespath