SBM Bank Kenya Reports Robust H1 Performance
SBM Bank Kenya has posted a sharp rise in profitability after reporting a 171 per cent increase in profit before tax for the first half of 2026, signalling stronger financial performance driven by higher lending, growing customer deposits and continued investment in digital banking.
Financial results released by the lender show profit before tax climbed to Sh548 million during the six months to June 2026, compared to Sh202 million recorded during the same period last year. Operating profit also rose significantly, reaching Sh852 million, nearly four times higher than the previous year’s performance.
Growth comes as Kenya’s banking sector continues to benefit from rising demand for credit, stronger customer confidence and increased adoption of digital financial services despite a challenging economic environment.
SBM Bank attributed the improved performance to robust revenue growth, prudent risk management and deliberate efforts to strengthen its balance sheet while expanding lending to households and businesses across the country.
“These results are about far more than stronger profitability. They demonstrate the continued strengthening of our institution. Over the past two years, we have deliberately focused on building a bank with higher quality earnings, disciplined risk management, a resilient balance sheet and the agility to respond quickly to our customers’ evolving needs. The first half of 2026 provides further evidence that this strategy is delivering sustainable value,” said SBM Bank Kenya Chief Executive Bhartesh Shah.
Loan growth and healthier balance sheet boost earnings
Net loans and advances expanded by 18 per cent to Sh54.1 billion, reflecting increased lending activity to individuals and businesses. Rising demand for credit played a key role in driving interest income while supporting growth across the bank’s core business segments.
Quality of the bank’s loan book also improved considerably during the review period. Gross non-performing loans declined sharply, with the ratio falling to 17.3 per cent from 32.4 per cent recorded a year earlier.
Lower non-performing loans indicate that more borrowers are meeting their repayment obligations, reducing credit risk and improving the overall health of the bank’s balance sheet.
Operating income grew by 35 per cent during the first half of the year, outpacing the 12 per cent increase in operating expenses despite continued investment in technology, infrastructure and customer services.
That strong operating leverage enabled the lender to convert higher revenues into stronger profitability while continuing to invest in long-term growth initiatives.
Net interest income increased to Sh2.2 billion, supported by higher lending volumes and improved earnings from interest-generating assets.
Non-funded income also delivered impressive growth, rising 54 per cent to Sh1.39 billion on the back of increased customer transactions and stronger activity across the bank’s service channels.
Diversifying income sources beyond traditional lending has become an increasingly important strategy for banks seeking to strengthen earnings amid changing market conditions.
Customer confidence fuels deposit growth
Customer deposits continued to rise strongly during the first half of the year, increasing 23 per cent year-on-year to reach Sh94 billion. Over the last two years, deposits have grown by an impressive 66 per cent, underlining growing confidence in the lender.
Deposit growth is widely viewed as a key measure of customer trust because it reflects confidence in a bank’s financial strength, governance standards and long-term stability.
“The continued growth in customer deposits is particularly encouraging because it reflects trust,” said Shah.
“Customers choose banks they believe are financially strong, well governed and committed to supporting them over the long term. Preserving and strengthening that confidence remains at the centre of every decision we make.”
Growing deposits provide banks with a stable source of funding, enabling them to expand lending while maintaining healthy liquidity levels and supporting future business growth.
SBM Bank also highlighted significant investments in digital banking as part of its broader strategy to improve customer experience and simplify banking services.
Digital transformation has become a major priority across Kenya’s banking industry as lenders compete to offer faster, more convenient and secure financial services through mobile and online platforms.
Investment in technology is expected to improve efficiency, reduce operational costs and meet changing customer expectations as more Kenyans embrace digital financial services.
Continued improvements in profitability, stronger asset quality and rising customer deposits suggest SBM Bank’s strategy of strengthening its balance sheet while investing in technology is beginning to deliver measurable results.
Momentum achieved during the first half of 2026 places the lender in a stronger position to pursue further growth during the remainder of the year, supported by expanding lending, improved risk management and continued innovation in digital banking services.
