Kenya’s banking sector has seen unprecedented profits in recent years. The record pre-tax profits of Sh262.3 billion in 2024 represented extraordinary financial achievement. With this remarkable economic success, what’s their ethical responsibility?

Banks are more than just profit-generating entities. They are indispensable arteries of the economic system, with a responsibility that extends far beyond balance sheets and shareholder returns.

This responsibility comprises three basic pillars: stewardship of trust, social function, and the welfare of borrowing customers.

First, trust is the currency of banking. When customers deposit their hard-earned savings or seek financial support, they are placing their hopes, dreams, and economic security in the hands of these institutions.

This trust demands that banks be prudent, transparent and ethical in managing customer’s deposits. It requires banks to view themselves as custodians of people’s financial well-being, not simply as profit-maximising machines.

The social function of banks is equally important. They are not isolated economic actors but essential contributors to societal development. By providing loans to families and businesses, banks generate jobs, support entrepreneurship, and drive economic growth.

But true success must be measured not just in monetary terms, but in the banks’ impact on communities and the lives of individuals.

When there are economic challenges – like right now – with high non-performing loan rates reaching 16.5 percent, banks must show compassion and flexibility. They should not just enforce strict lending criteria but help customers weather financial difficulties.

While profitability is important for the survival of banks – and Kenya’s financial institutions have shown amazing resilience – it cannot come at the expense of ethical considerations. The reliance on government securities and high lending rates, while financially expedient, raises serious questions about access to credit for Kenyans and fairness.

Lawmakers and industry experts have correctly challenged the banking sector to look beyond immediate financial gains. The argument that profits are reinvested into business expansion is valid, but it must be balanced with a genuine commitment to economic growth that carries everyone along.

Looking into the future, Kenyan banks must redefine their collective purpose. Profit should not be the destination but a means to create value that benefits the whole society. This will mean balancing profits and growth with social responsibility, innovative customer solutions with ethical considerations, and shareholder interests with community welfare.

Bank executives and shareholders have every right to celebrate these billion-shilling profits. But we don’t think the future of banking lies in how much money these institutions make but in how that money changes people’s lives for the better, supports the dreams of individuals, and contributes to a more equitable and prosperous society.