Kenya’s listed banks recorded impressive performance for the year ending December 31, 2024, with profits nearly doubling from previous years for most firms, amid tough economic conditions, while other listed firms experienced mixed results.

During the review period, KCB Bank recorded a net profit of Sh61.8 billion, representing a 64.9 per cent growth from Sh37.5 billion in the previous year. As a result, shareholders are expected to receive a total dividend of Sh9.6 billion, translating to Sh3 per share. The group’s balance sheet stood at Sh1.96 trillion, supported by a strong deposit base and a stable loan portfolio.

Total revenues increased by 24 per cent to Sh204.9 billion from Sh165.2 billion, driven by higher interest income and nonfunded income from foreign exchange trading.

“The Group strives to be more agile by rethinking our customer-centred value propositions and leveraging group capabilities in the markets where we operate. Our focus is on ensuring we have fit-for-purpose technology that delivers seamless, reliable, secure, and innovative solutions for our customers,” said Paul Russo, CEO of KCB Bank. Standard Chartered Bank followed closely, recording a 45 per cent growth in profit after tax to reach Sh20.06 billion for the year ended December 31, 2024, up from Sh13.8 billion in 2023.

The group’s balance sheet remained strong, with total operating income increasing to Sh50.6 billion from Sh41.7 billion in the previous financial year. The bank announced a final dividend of Sh37.00 per ordinary share of Sh5.00, in addition to an interim dividend of Sh8.00 paid in October, bringing the total payout to Sh13.9 billion.

“This growth was driven by strong topline performance, good business momentum, and excellent execution of our strategy, combining differentiated cross-border capabilities for corporate and institutional clients with leading wealth management solutions for affluent clients,” said Kariuki Ngari, CEO of Standard Chartered Bank, during the report launch.

Co-op Bank recorded a net profit of Sh25.5 billion, up from Sh23.2 billion in 2023, representing a 9.8 per cent growth.

This resulted in a recommended dividend of Sh1.50 per share for shareholders. The bank’s total shareholders’ funds increased by 28 per cent to Sh145.4 billion from Sh113.6 billion in 2023, driven by strong growth in retained earnings of Sh16.7 billion. Total assets grew by 10.7 per cent to reach Sh743.2 billion, up from Sh671.1 billion in the previous year.

“The bank’s strong performance aligns with our strategic focus on sustainable growth, resilience, and agility, riding on the ‘Soaring Eagle’ Transformation Agenda,” Co-op Bank said in a statement.

Absa Bank also reported a 28 per cent profit growth, reaching Sh20.9 billion for the period under review. The bank announced a dividend of Sh1.75 per share, totaling Sh9.5 billion for the year. Meanwhile, the National Bank of Kenya (NBK) recorded a profit after tax of Sh1.06 billion, marking a recovery from the aftertax loss of Sh3.3 billion recorded in the previous year.

Banking industry sources noted that the huge profits stem from significant investments and strategic business expansions.

“Many assume that banks make profits effortlessly, but the reality is that these earnings are reinvested into business expansion, ultimately growing our capital base,” said a banking industry expert. Legislators, however, argue that banks prefer investing in government securities due to their high profitability and guaranteed payments, thereby limiting access to affordable loans for customers.

While not refuting these claims, the expert from the banned banking sector pointed out that reliance on government securities is not absolute, as delayed government payments could negatively impact the sector if banks were overly dependent on them.

The high Non-Performing Loans (NPLs) rate of 16.5 per cent remains a key driver of high interest rates, making loans less accessible to Kenyans, a factor largely influenced by government economic activities. In the corporate sector, Kenya Electricity Generating Company (KenGen) reported a 48 per cent rise in profit after tax to Sh5.02 billion, attributed to operational efficiencies and increased geothermal output.

Managing Director and CEO Peter Njenga credited the improved performance to enhanced efficiency in the company’s geothermal fleet in Olkaria, Naivasha, and the Olkaria I Additional Unit 6 geothermal power plant, which added 86MW to the grid in July 2022. KenGen’s half-year pre-tax profit also rose to Sh7.95 billion from Sh4.83 billion in the previous period, despite a 4 per cent decline in total revenue to Sh27.5 billion.

Operating costs dropped by 14 per cent to Sh17.7 billion, reflecting strict cost management. British American Tobacco (BAT) Kenya recorded a 1 per cent increase in net revenue to Sh25.7 billion, although profit before tax declined by 19 per cent to Sh6.5 billion, mainly due to a 955 per cent surge in financing costs driven by foreign exchange losses.

“The company remains resilient, maintaining solid fundamentals. The Board’s proposed final dividend payout of Sh45 per share, in addition to the interim dividend of Sh5 per share paid in September 2024, brings the total dividend for the 2024 financial year to Sh50 per share, representing a 1 per cent improvement in yield to 13 per cent compared to 2023,” BAT Kenya stated.

Kenya’s tea firms, however, faced a challenging business environment. Williamson Tea Kenya reported a net profit of Sh526.9 million, a slight decline from Sh564.2 million recorded the previous year, despite a 4.3 per cent rise in revenue to Sh4.2 billion.

“Despite the positive results, the outlook for the company and the Kenyan tea industry remains dire. Tea prices have dropped to unsustainable levels due to market saturation and an estimated 200 million kg of unsold KTDA teas, while the Kenyan shilling has also stabilized,” the company said. Kapchorua Tea, however, increased its net profit by 27 per cent to Sh399 million for the full year ending March 2024.