Absa Bank Kenya PLC posted a 10% increase in full-year profit and lifted its dividend payout after tighter cost controls and lower loan-loss provisions helped offset pressure on interest income.
Net income rose to 22.9 billion shillings ($177 million) in the year ended Dec. 31, from a year earlier, the Nairobi-based lender said Tuesday. Total revenue was little changed at 61.4 billion shillings as a softer interest-rate environment weighed on lending margins.
The bank proposed a 17% increase in total dividend to 2.05 shillings per share, comprising an interim payment of 0.20 shillings and a final dividend of 1.85 shillings.
Net interest income declined 6% to 43.3 billion shillings, reflecting shifts in monetary conditions, while non-interest income climbed 12% to 18.1 billion shillings, supported by growth in payments and other fee-based businesses.
Chief Executive Officer Abdi Mohamed said the results underscored the lender’s focus on “disciplined execution” and sustainable returns, even as economic conditions remained dynamic.
Operating expenses fell 5% to 22.4 billion shillings, aided by digitization and automation initiatives. The bank said 71% of customer processes are now digitized, with 94% of transactions conducted through alternative channels. The cost-to-income ratio improved to 36.5%.
Loan-loss provisions dropped 32% to 6.2 billion shillings, signaling improved asset quality and tighter credit-risk management. Return on equity stood at 22.8%.
The balance sheet expanded, with total assets rising 6% to 537.6 billion shillings. Customer deposits edged up 1% to 372.4 billion shillings, while net loans and advances increased 1% to about 312 billion shillings.
In corporate banking, the lender arranged a 16 billion-shilling medium-term note and a $156 million solar securitization, while its global markets unit gained a 15% share of foreign-exchange revenues. Assets under custody surpassed 69 billion shillings.
The bank’s capital adequacy ratio was 21%, comfortably above regulatory requirements, while the liquidity reserve ratio stood at 45.6%, providing headroom for further expansion.
Mohamed said the lender will continue investing in technology, brand positioning and customer experience to sustain growth momentum in 2026.
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