Barclays Bank
Bill Co-operative
David Thuku
Diamond Trust Bank (Sh1.3
Equity Bank (Sh6.7
Family Bank
National Bank
NIC Bank
Sh1.3 billion
Standard Group

Banks dependent on interest income despite rate cap

More than a year after Parliament imposed a rate cap on banks, Kenyan lenders have not figured out a way of making money other than squeezing every cent from borrowers’ pockets.

According to a sample of the biggest lenders, non-interest income, which is money made from fees, commissions and subsidiaries like securities firms, insurance and forex trading remained flat for the first quarter this year.


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National Bank, which sunk into the red with a Sh278 million loss in the first three months of the year, saw about 12 per cent drop in non-interest earnings.

Barclays Bank, which posted Sh1.8 billion in profits for three months to March this year – an 8.2 per cent growth from Sh1.7 billion in 2017 – also saw its other revenue shrink. Non-funded income was down 5.5 per cent to Sh2.2 billion from business other than loans.

However, Family Bank, which jumped from negative territory last year to post a Sh35 million profit from Sh259 million loss in the 2017 first quarter saw a 12 per cent improvement in non-interest business to post Sh552 million.

“We are now seeing the results of streamlining our business operations and cost containment as well as our continued investment in technology-based financial solutions that offer our customers convenience and relevance,” said Family Bank Managing Director David Thuku.

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I&M pushed up non-interest income from Sh1.3 billion to Sh1.8 billion while Equity Bank (Sh6.7 billion), NIC Bank (Sh1.04 billion), Diamond Trust Bank (Sh1.3 billion) and Co-operative bank (Sh3.5 billion) all saw a slight increase in non-interest incomes.

KCB had a flat growth in non-interest income, a 0.4 per cent increase to Sh5.5 billion.

The sample of mostly listed lenders also showed that bad loans were a big problem, jumping up by over 100 per cent for certain lenders.


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Co-operative Bank saw its bad loans spike 152 per cent to Sh28 billion while those of I&M jumped 134 per cent to Sh22 billion. DTB saw an 82 per cent increase to Sh15.3 billion.

KCB held the largest stock of non-performing loans among the sampled listed lenders at Sh43.7 billion, a 36 per cent rise.

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