Barclays Bank has announced 3Q13 results this morning, posting a 10.2% y/y decline in PAT to KES 5.6bn driven by a one-off restructuring cost of KES 788.3m and a faster rise in operating expenses (+5.7% y/y to KES 11.8bn) than in operating income (+2.1% y/y to KES 20.9bn). The one-off restructuring cost was similar to that in 1H13 and is expected to be incurred in FY13 as well. The rise in operating expenses was largely driven by higher loan loss provisions (+66.0% y/y to KES 887.8m) even as gross NPLs declined 12.1% y/y to KES 3.6bn. Excluding the loan loss provision expense, the bank maintained stable cost efficiency with the cost to income ratio at 52.3% compared to 52.0% in 3Q12. Net interest income grew 4.4% y/y to KES 14.0bn driven by a steep decline in interest expenses (-22.9% y/y to KES 1.8bn) and interest income was flat, growing 0.7% y/y to KES 15.8bn. The loan book expanded 11.5% y/y to KES 116.3bn and customer deposits were notably down 9.6% y/y at KES 137.7bn. Non-interest income was down 2.3% y/y to KES 6.9bn on the back of lower forex trading income (-17.3% y/y to KES 1.6bn). (Source; Company, Kestrel Research)