NCBA Group Posts Sh23.4 Billion Profit as Interest Income Surges 27.7 Percent

NCBA Group closed 2025 with profit after tax rising 7 percent to Sh23.4 billion, as a sharp 27.7 percent surge in net interest income more than offset a 46.3 percent jump in loan-loss provisions that the lender set aside against a growing pile of bad debts.

The results, covering the year ended 31 December 2025, show a bank generating more income from every major line but spending significantly more to cover credit risk.

FY2025 Group Results

Table 1: NCBA Group key income statement and balance sheet metrics, FY2024 vs FY2025 (KES). 

Income: Interest Takes the Lead as Non-Interest Growth Stalls

Total operating income grew 16.9 percent to Sh73.3 billion, but the composition tells a more important story. Net interest income drove most of the growth, climbing 27.7 percent to Sh44.1 billion. Non-interest income, by contrast, edged up just 3.8 percent to Sh29.3 billion, a meaningful deceleration that points to pressure on fees, commissions, and trading revenues.

Government securities continued to anchor the interest income story. NCBA holds a large portfolio of Treasury bills and bonds, and rising yields on that paper fed directly into the net interest income line. Loan interest also contributed, with the loan book growing 5 percent to Sh317.2 billion.

Income Mix: Where the Sh73.3 Billion Came From

Table 2: NCBA Group operating income breakdown, FY2024 vs FY2025.

Credit Risk: Provisions Jump 46 Percent as Bad Loans Rise

Gross non-performing loans rose approximately 10.3 percent over the year. The bank responded by setting aside substantially more cover, which pushed the cost of risk higher and compressed the gap between operating income growth (16.9 percent) and profit after tax growth (7 percent). That nine percentage-point gap between top-line and bottom-line growth reflects the provision charge more than anything else.

Net NPL exposure after provisions narrowed, which means the bank is building a thicker buffer against future write-offs. But the underlying NPL stock is still growing, and the NPL ratio has edged upward. This remains the central risk to watch in 2026.

Asset Quality

Table 3: NCBA Group asset quality metrics, FY2024 vs FY2025. Gross NPL and NPL ratio figures are estimated from disclosed provision data and loan book size.

Balance Sheet: Steady Growth, No Dramatic Shifts

Total assets grew 7.5 percent to Sh716.0 billion, a measured expansion that broadly tracks nominal GDP growth in Kenya. Customer deposits rose 5.9 percent to Sh531.9 billion, while the loan book grew 5 percent to Sh317.2 billion — a loan-to-deposit ratio of approximately 59.6 percent, which leaves significant headroom for further lending if credit conditions improve.

The balance sheet growth is solid but unspectacular. Unlike some peers that deployed large deposit inflows into government securities to juice income, NCBA’s asset base expanded relatively evenly across loans and investments.

Shareholder Returns: Dividend Jumps 29 Percent

NCBA’s board recommended a final dividend that brings the full-year payout to KES 7.10 per share — a 29.1 percent increase from KES 5.50 in 2024. That outpaces the 7 percent growth in both profit and earnings per share by a wide margin, signalling that management is willing to return more cash to shareholders even as provisions rise.

Earnings per share rose 7 percent to KES 14.20, in line with profit growth. Dividend cover narrowed to approximately 2.0 times from 2.41 times, reflecting the higher payout ratio.

The board also announced that NCBA Group PLC would receive a notice of intention from Nedbank Group to acquire NCBA ordinary shares, potentially making Nedbank a majority shareholder — a transaction subject to regulatory approval from the Capital Markets Authority, Central Bank of Kenya, and other competition authorities.

Returns to Shareholders

Table 4: NCBA Group per-share data and dividend metrics, FY2024 vs FY2025. Dividend cover and total payout calculated from disclosed EPS and DPS figures.

Nedbank Transaction

On 27 January 2026, NCBA Group received a notice of intention from Nedbank Group of South Africa to acquire ordinary shares in NCBA, potentially making Nedbank the majority shareholder with 54.98 percent of the issued share capital, while the remaining 24 percent would be listed on the Nairobi Securities Exchange.

The transaction is subject to regulatory approvals including the Capital Markets Authority, the Central Bank of Kenya, and competition authorities. NCBA said it expects to announce whether it intends to make the offer or not no later than nine weeks from the date of the announcement. I