Nairobi: Absa Bank Kenya PLC has announced a 9 percent increase in profit after tax for the first half of 2025, driven by cost management, increased non-funded income, and prudent risk management despite a significant decline in interest rates that impacted lending growth. Speaking during the bank’s half-year financial results briefing in Nairobi, Managing Director and Chief Executive Officer Abdi Mohammed emphasized the bank’s resilience in a challenging macroeconomic environment.
According to Kenya News Agency, Mohammed highlighted that the bank’s strategy focused on benefiting customers from the Central Bank’s monetary policy easing while preparing for sustainable growth in the year’s second half. The bank reduced its base lending rate by 700 basis points, making credit more affordable and stimulating private sector activity. He noted that the Kenyan economy remains on a positive trajectory, with GDP growth forecasted at around 5 percent for 2025, fueled by agriculture, infrastructure, telecommunications, and tourism.
The CEO also mentioned that inflation had eased into the target range due to strong agricultural output and monetary policy interventions, allowing for a gradual reduction in the Central Bank Rate. He added that stable foreign exchange rates over the past two years have boosted investor confidence, and improved credit conditions are expected to increase lending in the latter half of the year.
Mohammed emphasized Absa’s commitment to its people agenda, with ongoing investments in talent, diversity, and inclusion. Nearly half of senior leadership roles are held by women, and the bank has increased recruitment and training for individuals with disabilities. Additionally, he announced the opening of Absa’s 87th branch in Kawangware, further expanding its footprint and agency network to improve accessibility for SMEs.
Lending in the first half stood at Sh77 billion, targeting sectors from micro-businesses to corporates, with Sh1.3 billion in restructured loans to aid customers in financial distress. The bank also intensified non-financial support, including skills training and market exposure for its 7,000 business club members. Mohammed stated that the bank is balancing commercial growth with its sustainability agenda, particularly for women-led enterprises.
From the presentation, Absa’s consumer banking segment achieved double-digit growth in both interest and non-interest income, driven by digital lending, asset management, bancassurance, and the credit card business. Assets under management in the asset management arm increased to Sh30 billion, positioning the bank among the top three in the sector within two years of launch. In business banking, initiatives included targeted Islamic banking products, SME capacity building, and expansion in the mortgage market.
In corporate banking, the custody business, launched in early 2025, had already attracted Sh40 billion in assets under management. In global markets, the bank reported a tenfold growth in retail foreign exchange volumes and introduced new investment products in partnership with the Nairobi Securities Exchange, including the dual listing of a world Exchange-Traded Fund.
Chief Finance Officer Yusuf Omari disclosed that the 9 percent profit growth was achieved despite a 1 percent drop in revenue, as the bank cut costs and reduced impairment charges by 8 percent. He noted that customer deposits grew 2 percent year-on-year, while total assets rose by 10 percent to Sh532 billion, supported by a 70 percent increase in investments in government securities. Meanwhile, Omari revealed that loan impairment charges fell by 38 percent, improving the loan loss ratio to 2.1 percent from 3.3 percent a year earlier.
Looking ahead, Omari stated that Absa would continue to focus on growing low-cost deposits, expanding private sector lending as credit demand recovers, and sustaining efficiency gains. He reaffirmed the bank’s commitment to community initiatives through the Absa Foundation, focusing on entrepreneurship, education, and sustainability projects.
