The African Development Bank Group (AfDB) and KCB Bank Kenya Limited have signed a $150 million financing package to accelerate green finance and climate-smart investments.
The deal enhances KCB’s trade finance capacity within Kenya’s growing small business and corporate banking sector.
The package includes:
- $100 million subordinated debt facility: strengthening KCB’s Tier II capital and reinforcing its role as a financial intermediary in strategic sectors. This supports KCB’s target of allocating 25% of its portfolio to green initiatives by 2031, including renewable energy, sustainable infrastructure, and climate-smart agriculture.
- $50 million transaction guarantee: enabling AfDB to provide up to 100% coverage to confirming banks against non-payment risks for letters of credit and similar trade finance instruments issued by KCB.
What Green Loans Mean at KCB
Green loans are financing instruments specifically directed toward projects that deliver environmental benefits alongside economic returns. For KCB, this means:
- Renewable energy projects: solar, wind, and hydro investments that reduce reliance on fossil fuels.
- Sustainable infrastructure: climate-resilient roads, housing, and water systems.
- Agriculture: supporting climate-smart farming practices that improve yields while conserving ecosystems.
- Blue economy initiatives: investments in sustainable fisheries and marine resources.
- E-mobility and clean transport: financing electric vehicles and charging infrastructure.
- Climate adaptation: projects that help communities withstand floods, droughts, and other climate shocks.
In 2024, KCB disbursed $402 million in green loans, expanding its green portfolio to 21.32% from 15% in 2023. This growth reflects KCB’s ambition to scale up green lending, catalyse private investment, and support Kenya’s net-zero emissions goal by 2050.
Regional Impact
Alex Mubiru, AfDB Director General for East Africa, noted:
“This facility is a testament to our shared commitment to advancing Africa’s green transition and ensuring that economic growth goes hand in hand with environmental stewardship.”
Annastacia Kimtai, KCB Bank Kenya Managing Director, added:
“This partnership marks a significant milestone in our sustainability journey as it reinforces our commitment to scale up green lending and deepen our impact.”
This collaboration is expected to deliver:
- Expanded access to long-term finance for SMEs and women-led businesses
- Job creation in climate-resilient sectors
- Strengthened resilience to economic shocks
- Measurable climate impact across Kenya and East Africa
KCB Group Receives Green Climate Fund Accreditation for Climate Finance
