Consolidated Bank of Kenya is set to receive a KSh 1.125 billion bailout package from National Treasury. The lender has been bleeding red on its balance sheet.
As of December 2025, Consolidated Bank of Kenya had a negative core capital of KSh 546 million, meaning it technically owed more than it owes.
But this is not Consolidated Bank of Kenya’s full story. Central Bank of Kenya(CBK) revised minimum capital threshold jump to KSh3 billion effective January 1, 2026 — meaning the bank needs at least KSh 3.546 Billion in fresh capital just to be compliant. National Treasury’s injection covers barely a third of that.
Consolidated Bank of Kenya plan to fill the gap includes selling fixed assets such as buildings, rely on internally generated revenue or submit a capital build-up plan.
A state-owned bank, structurally undercapitalised, selling assets to stay alive, while the public purse plugs the hole. We’ve seen this movie before, and it rarely ends with a dividend.
The harder question is not whether Consolidated Bank survives. It is whether a bank this fragile should remain a going concern at all, or whether a merger, acquisition, or structured wind-down serves the public interest better. Consolidated Bank has reported net profit of KSh 198.2 million for the twelve months period to December last year powered by strong income.
The bank made the recovery from a loss of KSh 155.2 million reported the previous year after reporting a historic total operating income which rose by 28pc to KSh 1.9 billion from KSh 1.5 billion reported the previous year. Consolidated Bank Acting Chief Executive Officer Dr Dominic Murage said the performance was also on the backdrop of its strategy to turnaround the state-owned lender.
“This performance demonstrates the impact of the strategic efficiency measures we implemented across the business, which have enabled significant cost savings. Maintaining these efficiency levels will remain a priority going forward,” said Dr. Murage.
Interest earnings from loans and advances grew 38% to Ksh.1.3 billion, from Ksh.940 million reported in the previous year, while non-funded income grew surged by 11pc to KSh 631 million from KSh 568 million.
Cost rationalization saw the bank’s operating expenses rise marginally by 1% to KSh 1.7 billon from KSh 1.6 billion.
The bank which is being considered for privatization by the National Treasury grew its loan book marginally from KSh 8.5 billion to KSh 8.6 billion as provisions for loan impairments grew by 23pc to KSh 288 million due to the tough operating environment it says most businesses operated in and the its principles of prudence in risk management.
Murage said the lender will continue focusing on Small and Medium Enterprises (SMEs) lending where majority of its clients are.
“Additionally, as a government‑owned institution, we are uniquely positioned to support public sector financing needs. We aim to strengthen our collaboration with government agencies, parastatals, universities and ministries to position Consolidated Bank as the preferred banking partner for the public sector” he added.
During the year under review, the Consolidated Bank assets grew by 11pc to KSh 19.5 billion on strong investment from government securities.
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