Shareholders of tier one lenders NCBA, I&M, and Diamond Trust Bank (DTB) are set for substantial payouts as the lenders announced increased dividends, buoyed by robust profit growth in 2024.
Among the big winners are the billionaire Kenyatta and Ndegwa families, who are among the major beneficiaries of NCBA’s generous cash distribution.
NCBA Group posted a profit after tax of Sh21.9 billion, a 2.0 per cent increase from the Sh21.5 billion reported in 2023.
Despite a slight 1.5 per cent drop in operating income to Sh62.7 billion, the bank’s performance enabled it to declare a total dividend of Sh5.50 per share, up from Sh4.75 in the previous year, translating into a total payout of Sh9 billion.
Leading the pack of beneficiaries is First Chartered Securities Ltd, associated with the Ndegwa family, which will receive Sh1.3 billion.
Enke Investments Ltd, linked to the Kenyatta family, is set to earn Sh1.1 billion. Other significant recipients include D&M Management Services LLP (Sh1.03 billion), Brookshire Ltd (Sh752 million), and Westpoint Nominees (Sh697.7 million), with the remaining shareholders collectively receiving Sh4.07 billion.
NCBA also reported a 23 per cent year-on-year increase in digital loan disbursements, reaching Sh1.0 trillion, reflecting the growing reliance of Kenyans on digital credit amid rising living costs.
“The board has resolved to recommend to the Shareholders… the payment of a final dividend for the year of Sh3.25 per share, which, together with the interim dividend of Sh2.25 per share, brings the total dividend for the year 2024 to Sh5.50 per share,” the listed lender stated.
I&M Group also increased its dividend payout by Sh804 million to Sh5 billion. The bank’s directors recommended a final dividend of Sh1.70 per share, amounting to Sh2.8 billion, which, combined with an interim dividend of Sh1.30 per share, results in a total dividend of Sh3.00 per share. This increase follows a 22 per cent rise in net earnings, amounting to Sh15.3 billion.
Major shareholders, including Minard Holdings Ltd (Sh1.08 billion), Tecoma Ltd (Sh923 million), Ziyungi Ltd (Sh892 million), and CDC Group (Sh508 million), are set to benefit significantly.
This is after the lender reported Sh20.8 billion in profit after tax for the year ended December 2024, driven largely by growth in MSME lending and its retail business.
Total income increased 20 percent to Sh51.2 billion, with the bank citing business diversification and improved performance from subsidiaries for the growth in earnings.
“Operating income was up 12 per cent, driven by growth in target areas, including lending to MSMEs, digital banking, and new customer acquisition,” explained Kihara Maina, I&M Group regional CEO.
The bank continues to register strong performance from its regional subsidiaries, which saw a 29 percent increase in contribution to group revenues, while earnings from cross-border business went up 57 percent to $USD 6 million.
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Overall lending, however, dropped seven per cent from the Sh311 billion reported in 2023 to Sh287 billion last year, with the management citing the difficult business environment and the appreciation of the Kenyan shilling.
“Net loans and advances decreased during the period, primarily due to a cautious approach by clients in Kenya, influenced by the challenging macroeconomic conditions and increasing yields,” explained Mr. Maina.
DTB announced a 16 percent increase in its dividend payout to Sh7.82 billion, up from Sh6.7 billion the previous year.
The Aga Khan Fund for Economic Development (AKFED) and Habib Bank Limited are among the primary beneficiaries, receiving Sh1.29 billion and Sh1.26 billion, respectively.
“Based on the year-end results achieved, the Directors will recommend… payment of a first and final dividend of 175 percent (i.e., at Sh7.00 per share) for the year 2024,” DTB stated.
The increased dividends across these major banks reflect a strong financial year for the banking sector, rewarding shareholders and highlighting the sector’s resilience and profitability in the Kenyan market.
