A comprehensive analysis for non-technical audiences
This report analyzes the financial performance of Kenya's top five banks for the fiscal year 2024. Despite challenging economic conditions, including inflationary pressures and currency fluctuations, these banking institutions demonstrated remarkable resilience and growth.
KCB Group leads the pack with the highest profit of KSh 61.8 billion, showing extraordinary growth of 64.9% from 2023. All five banks reported profits, with growth ranging from 2% to 65%, indicating a strong and resilient banking sector in Kenya.
Up 33% from 2023
Representing 80% of banking sector
Above industry average of 18.5%
The Kenyan banking sector demonstrated strong performance in 2024 despite economic challenges. The sector was characterized by increased digitalization, strategic regional expansion, and innovative products to capture the growing middle-class market.
Kenya's banking sector showed remarkable resilience in 2024, with the top five banks controlling approximately 80% of the market. Digital transformation and regional diversification were key drivers of growth, helping these institutions overcome economic challenges such as inflation and exchange rate fluctuations.
East Africa's largest commercial bank
64.9% from 2023
Well-diversified asset base
From 17.8% in 2023
KCB Group delivered exceptional performance in 2024, with profit after tax growing by an impressive 64.9% to KSh 61.8 billion. This strong performance was driven by increased interest income and substantial growth in non-funded income from foreign exchange trading.
The Group's balance sheet expanded to KSh 1.96 trillion, supported by a robust deposit franchise and a stable loan portfolio. Total revenues increased by 24.0% to KSh 204.9 billion, reflecting strong top-line growth across all business segments.
KCB Group emerged as the most profitable bank in Kenya for 2024, with extraordinary growth in profits and returns to shareholders. The bank's diversification strategy and regional expansion have paid off handsomely, contributing significantly to its impressive performance.
Financial services holding company
12% from 2023
Strong customer base of 21.6 million
Above industry average
Equity Group Holdings Plc achieved a profit after tax of KSh 48.8 billion in FY 2024, showcasing the continued success of the Group's diversified business model and prudent risk management. The Group's profit before tax grew by 17% to KSh 60.7 billion, while earnings per share rose by 11% to KSh 12.3.
The Group's liquidity position remains strong, with cash and cash equivalents rising by 19% to KSh 345 billion, while investment securities grew to KSh 512 billion, contributing to an overall liquidity ratio of 57%. Regional subsidiaries contributed 49% of total assets and 54% of profit before tax, highlighting successful diversification.
Equity Group maintained its position as a leading financial institution in Kenya with solid growth in profits and an impressive regional expansion strategy. Its digital transformation initiatives have paid off, with 86% of transactions now processed through digital channels, enhancing customer experience and operational efficiency.
Leading cooperative banking institution
9.8% from 2023
10.7% from 2023
Competitive return for shareholders
Co-operative Bank reported a profit before tax of KSh 34.8 billion for FY 2024, a 7.5% growth compared to KSh 32.4 billion in 2023. This translates to a profit after tax of KSh 25.5 billion, representing a 9.8% increase from the previous year's KSh 23.2 billion.
The bank's balance sheet strengthened with total assets growing to KSh 743.2 billion, a 10.7% increase from KSh 671.1 billion in 2023. Customer deposits grew by 12.1% to KSh 506.1 billion, while shareholders' funds increased by 28% to KSh 145.4 billion, driven by strong growth in retained earnings.
Co-operative Bank achieved its best performance ever in 2024, with steady growth in profits, assets, and customer deposits. The bank's focus on cooperative banking and serving its core customer segments has yielded consistent results, making it the third most profitable bank in Kenya's top tier.
Merged entity of NIC and CBA banks
2.0% from 2023
Diverse revenue streams
15.8% from KSh 4.75 in 2023
NCBA Group PLC posted a profit after tax of KSh 21.9 billion in its FY 2024 financial results, a 2.0% increase compared to KSh 21.5 billion reported in 2023. The Group demonstrated moderate growth despite challenging economic conditions.
Total operating income reached KSh 62.7 billion, slightly down from KSh 63.7 billion in 2023. However, the bank managed to increase its dividend payout to shareholders, reflecting confidence in its financial position and future prospects. NCBA successfully rebranded AIG Kenya to NCBA IG Insurance, indicating a strategic move in the insurance sector.
NCBA Group showed modest growth in 2024, maintaining its position in Kenya's top tier banking sector. Despite slight challenges in growing operating income, the bank managed to increase profits and boost shareholder returns, demonstrating resilience and effective cost management strategies.
Subsidiary of global banking group
45% from 2023
21% from 2023
46% from KSh 36.2 in 2023
Standard Chartered Bank Kenya delivered a record performance in 2024 with profit before tax up 43% to KSh 28.2 billion, driven by strong topline growth and excellent execution of strategy. Profit after tax increased by 45% to KSh 20.1 billion from KSh 13.8 billion in 2023.
Operating income increased by 21% to KSh 50.7 billion, driven by 13% growth in net interest income due to volume growth and improved margins, and a 40% increase in non-interest income from increased transactional volumes in Transaction Services, Markets, and Wealth Solutions. The bank managed its costs well, delivering significant positive income-to-cost jaws of 13%.
Standard Chartered Bank Kenya demonstrated exceptional growth in 2024, with one of the highest percentage increases in profit among the top five banks. The bank's focus on wealth management, transaction services, and cost efficiency has yielded impressive results, positioning it strongly in the competitive banking landscape.
This section compares the performance of the top five banks across various financial metrics, allowing for a comprehensive understanding of their relative strengths and market positions.
While KCB Group and Equity Group maintain their leadership in terms of absolute profit figures, Standard Chartered Bank Kenya showed the second-highest growth rate at 45%, demonstrating exceptional performance improvement. NCBA Group had the most modest growth at 2%, suggesting potential challenges or a more conservative approach.
| Bank | Profit After Tax (KSh Bn) | YoY Growth | Total Assets (KSh Bn) | Return on Equity | Cost to Income Ratio |
|---|---|---|---|---|---|
| KCB Group | 61.8 | 64.9% | 1,960 | 24.6% | 45.3% |
| Equity Group | 48.8 | 12.0% | 1,400+ | 21.5% | 48.2% |
| Co-operative Bank | 25.5 | 9.8% | 743.2 | 19.7% | 51.4% |
| NCBA Group | 21.9 | 2.0% | 679.0 | 18.5% | 53.9% |
| Standard Chartered | 20.1 | 45.0% | 580.0 | 22.4% | 39.6% |
Profitability ratios help measure how effectively a bank is generating profits from its operations. These metrics are crucial for investors and stakeholders to evaluate the financial health and performance of banking institutions.
Formula: Net Income ÷ Total Assets
Example: If a bank has a net income of KSh 10 billion and total assets of KSh 500 billion, its ROA is 2%.
Formula: Net Income ÷ Shareholders' Equity
Example: If a bank earns KSh 10 billion with shareholders' equity of KSh 50 billion, its ROE is 20%.
Formula: (Interest Income - Interest Expense) ÷ Average Earning Assets
Example: If a bank earns KSh 30 billion in interest, pays KSh 10 billion in interest, and has average earning assets of KSh 400 billion, its NIM is 5%.
KCB Group leads in profitability metrics with the highest ROE of 24.6%, followed by Standard Chartered Bank at 22.4%. All five banks maintained ROE above 18%, significantly outperforming the average for emerging markets banking sectors. Standard Chartered has the highest net interest margin, indicating efficient interest-generating operations.
| Bank | Interest Income (%) | Non-Interest Income (%) | Cost to Income Ratio (%) | Loan Loss Provision (KSh Bn) |
|---|---|---|---|---|
| KCB Group | 67.0 | 33.0 | 45.3 | 14.2 |
| Equity Group | 70.2 | 29.8 | 48.2 | 20.2 |
| Co-operative Bank | 73.5 | 26.5 | 51.4 | 8.6 |
| NCBA Group | 65.8 | 34.2 | 53.9 | 12.4 |
| Standard Chartered | 65.6 | 34.4 | 39.6 | 2.4 |
The balance sheet provides a snapshot of a bank's financial position, showing its assets, liabilities, and equity. Understanding balance sheet strengths and weaknesses is crucial for evaluating a bank's stability and growth potential.
KCB Group and Equity Group hold the largest asset bases among Kenya's top banks, with KCB leading at KSh 1.96 trillion. While asset size indicates scale, it's the quality of these assets and how efficiently they're managed that determines profitability. Standard Chartered, despite having a smaller asset base, demonstrates excellent efficiency in asset utilization.
Formula: Total Loans ÷ Total Deposits
Example: If a bank has KSh 400 billion in loans and KSh 600 billion in deposits, its loan-to-deposit ratio is 66.7%.
A lower ratio means more liquidity but possibly lower profits; a higher ratio may mean higher profits but less liquidity.
Formula: Non-Performing Loans ÷ Total Loans
Example: If KSh 20 billion out of KSh 400 billion in loans aren't being repaid on time, the NPL ratio is 5%.
Lower is better; high NPL ratios can lead to financial problems for banks.
Formula: (Tier 1 Capital + Tier 2 Capital) ÷ Risk-Weighted Assets
Example: If a bank has KSh 80 billion in capital and KSh 500 billion in risk-weighted assets, its capital adequacy ratio is 16%.
Higher ratios indicate stronger ability to withstand financial shocks.
| Bank | Loans to Deposit Ratio (%) | NPL Ratio (%) | NPL Coverage (%) | Capital Adequacy (%) |
|---|---|---|---|---|
| KCB Group | 70.7 | 19.2 | 71.0 | 19.4 |
| Equity Group | 65.3 | 12.2 | 71.0 | 18.6 |
| Co-operative Bank | 73.8 | 14.5 | 68.5 | 17.2 |
| NCBA Group | 62.4 | 15.8 | 73.2 | 16.9 |
| Standard Chartered | 51.0 | 10.4 | 75.6 | 19.6 |
Efficiency metrics help evaluate how well banks are using their resources to generate income. These indicators are important for understanding operational effectiveness and management quality.
Standard Chartered Bank Kenya stands out with the lowest cost-to-income ratio of 39.6%, indicating superior operational efficiency. KCB Group follows with 45.3%, while NCBA has the highest ratio at 53.9%, suggesting potential for efficiency improvements. Digital transformation has been a key driver of efficiency gains across the sector.
Formula: Operating Expenses ÷ Operating Income
Example: If a bank spends KSh 30 billion on operations and earns KSh 60 billion in income, its cost-to-income ratio is 50%.
Lower ratios indicate more efficient operations - the bank is spending less to generate more income.
Formula: Total Revenue ÷ Number of Employees
Example: If a bank generates KSh 60 billion in revenue with 5,000 employees, the revenue per employee is KSh 12 million.
Higher values suggest better staff productivity and operational efficiency.
Formula: Number of Digital Transactions ÷ Total Number of Transactions
Example: If 8.5 million out of 10 million transactions are conducted digitally, the digital transaction ratio is 85%.
Higher ratios typically indicate better cost efficiency and customer convenience.
Percentage of transactions performed through digital channels
Revenue generated per employee (KSh millions)
Kenya's top banks are well-positioned for continued growth in 2025, with digital transformation and regional expansion as key drivers. KCB Group and Equity Group are likely to maintain their leadership positions, while Standard Chartered's efficiency improvements position it for strong profitability. The sector's resilience and adaptation to changing market conditions bode well for sustained performance.
Expected to leverage its regional presence and digital capabilities to maintain strong growth. The bank's diversified revenue streams and scale advantages position it well for continued leadership, though managing asset quality will remain a challenge.
Likely to continue its focus on financial inclusion and digital innovation. The Group's strategic regional diversification will help mitigate country-specific risks, while its established agency banking model provides a competitive advantage in reaching underserved markets.
Well-positioned to benefit from its strong connections to the cooperative movement. The bank's focus on retail and SME banking should continue to yield steady results, with digital transformation initiatives potentially improving efficiency metrics.
Poised to leverage its digital lending expertise and expand its insurance offerings following the rebranding of AIG Kenya to NCBA IG Insurance. Improving operational efficiency should be a priority to enhance profitability in the competitive environment.
Expected to continue building on its impressive efficiency gains and strong wealth management proposition. The bank's global network provides unique advantages for corporate and institutional clients with international needs, while its digital transformation journey enhances retail customer experience.
This glossary provides simple explanations of the financial terms used throughout this report. It's designed to help non-technical readers understand banking terminology and financial concepts.
Everything a bank owns or controls, including loans, investments, buildings, and cash. Think of it as everything of value that the bank possesses.
A financial statement that shows what a bank owns (assets), what it owes (liabilities), and the difference between them (equity) at a specific point in time. It's like a snapshot of the bank's financial position.
A measure of a bank's capital in relation to its risk-weighted assets. It shows how well a bank can absorb losses before becoming insolvent. Higher ratios indicate stronger financial stability.
The percentage of a bank's income that goes toward operating expenses. Similar to how much of your salary goes to everyday expenses – lower percentages are better, indicating more efficient operations.
Money that customers have placed in the bank for safekeeping. This is a liability for the bank because it's money the bank owes to its customers.
A payment made by a bank to its shareholders from its profits. It's like receiving a portion of the company's earnings as a reward for being an investor.
The percentage of a bank's earnings that are paid to shareholders as dividends. A higher ratio means more profits are being distributed rather than reinvested in the business.
The amount of a bank's profit allocated to each outstanding share of common stock. It shows how much profit each share generates.
Money a bank earns from lending activities and investments. This is the main source of revenue for most banks, similar to how you might earn interest on a savings account.
What a bank owes to others, including customer deposits, loans from other banks, and other debts. Think of these as the bank's financial obligations.
Money set aside to cover potential losses from loans that may not be repaid. It's like an emergency fund for the bank to cover bad loans.
Money that a bank has lent to individuals, businesses, or other organizations. These are assets for the bank because they represent money owed to the bank.
The difference between the interest a bank earns on loans and investments and the interest it pays on deposits, expressed as a percentage of average earning assets. It shows how profitable a bank's lending activities are.
Revenue from fees, commissions, trading, and other services not related to interest. Examples include account fees, wire transfer fees, and currency exchange earnings.
A loan where the borrower has fallen behind on payments. Generally, loans are classified as non-performing if payments are more than 90 days overdue.
The percentage of a bank's total loans that are non-performing. A lower ratio indicates better loan quality and less risk.
The amount of money a bank has earned after deducting all costs, expenses, and taxes. Also called net income or net profit, it shows the final profit that belongs to shareholders.
A measure of how efficiently a bank is using its assets to generate profits. Higher percentages indicate better performance in converting assets into earnings.
A measure of how efficiently a bank is using shareholders' money to generate profits. It shows the amount of profit earned for each shilling of shareholders' equity.
The amount of money that would be returned to shareholders if all assets were liquidated and all debts paid. It represents the net worth of the bank to its owners.
The core capital of a bank, consisting primarily of common stock and retained earnings. It's the highest quality capital that can absorb losses without the bank needing to stop operations.
The sum of a bank's interest income and non-interest income before deducting expenses. It represents the total revenue generated by the bank's operations.
The percentage change in a financial metric compared to the same period in the previous year. It helps show whether performance is improving or declining over time.
This report was prepared based on publicly available information and financial data released by the respective banks. The analysis presented is for informational purposes only and should not be considered as investment advice. Readers should conduct their own research and consult with financial advisors before making investment decisions.