Kenya’s banking sector pre-tax profit hits 78.5pc in 2021

Commercial lenders saw their pre-tax profit jump to 78.5 percent in 2021 as the economy recovered from the Covid-19 scourge.

The Central Bank of Kenya’s (CBK) annual report for 2021, says profit before tax hit 197 billion shillings compared to 121.7 billion shillings in a similar period in 2020. 

CBK Governor Patrick Njoroge said the banking sector asset base grew by 11 percent to 6 trillion shillings in 2021 from 5.4 trillion in 2020.

According to the report by Kenya’s Apex bank, there are nine large banks in the country with a combined market share of 74.76 percent, eight medium banks with a market share of 16.41 percent while 22 small banks control 8.82 percent of the market share. 

The report indicates that the sector recorded strong capitalization levels as a result of retention of profits and additional capital injections. 

Equity Bank Group was the first to cross the Ksh1 trillion rubicon, after the acquisition and integration of its business with Banque Commerciale Du Congo (BCDC) in December 2020, eclipsing KCB Group as the largest bank in Kenya in terms of asset value.

Co-op Bank which acquired Jamii Bora two years ago and renamed it Kingdom Bank saw its total assets grow to 597 billion in the first three months of this year, an eight percent growth from 552.9 billion in the same period last year. 

According to the report, the country now has 20 operating local private commercial banks and two local public commercial banks, which accounted for 68.3 percent and 0.5 percent of total net assets respectively. 

A total of 17 operating commercial banks were foreign-owned and accounted for 31.2 percent of the sector’s assets.

 The regulator projects the sector to remain resilient in 2022, as banks continue supporting the post-Covid economic recovery. 

The state of the banking sector in Kenya is set to grow and strengthen further due to continued diversification and restructuring of business.