Absa Bank Kenya delivers 4% growth in net profit to Sh6.2 Billion in Q1 2025
Return on equity rose to 27 per cent for the period ended 31 March 2025, reflecting the strength of the Bank’s performance and capital efficiency during the quarter
Absa Bank Kenya Plc has reported a 4 per cent growth in net earnings to Ksh 6.2 billion for the period ended 31 March 2025, an indication of strong operational resilience and customer confidence, amid a challenging macro-economic landscape.
As a result of prevailing market conditions, total revenues closed at Ksh 15.8 billion, reflecting a 4 per cent year-on-year decline, impacted by a marginal decline in funded income to Ksh 11.3 billion and a 11 per cent drop in non-funded income to Ksh 4.5 billion.
In the review period, the Bank continued to empower its customers’ growth stories through the provision of essential financial support, advancing Ksh 308 billion in loans and advances to key economic sectors and individuals. Customer deposits rose by 5 per cent to Ksh 371 billion, with total assets growing by 5 per cent to Ksh 520 billion.
Speaking about the financial performance, Absa Bank Kenya Managing Director & CEO, Abdi Mohamed, highlighted that the results affirm the strength of the Bank’s strategic direction, and reinforce Absa’s commitment to delivering relevant, personalised financial and non-financial solutions that meet the evolving needs of individuals, businesses, and communities.
“While the operating environment remained complex, we continued to implement our forward-looking five-year strategic plan, which is guided by our core purpose: “Empowering Africa’s tomorrow, together…one story at a time. We are satisfied by the progress attained in the review period, even as we implement prudent measures to strengthen and sustain our balance sheet momentum in the near term,” said Mr. Mohamed.
During the quarter, the Bank deepened its role as a business enabler by facilitating its technology-focused business club members with international exposure to best practices through a trip to Estonia and Finland as well as to the United States. The members also gained first-hand access to international best practices in digital innovation and enterprise growth. In addition, the Bank enhanced its wealth management proposition as part of a broader strategy to strengthen its value offering to the consumer segment.
Furthermore, the Bank accelerated its thought leadership series for its corporate clients across the country focused on supporting them to navigate the dynamic operating landscape. Absa also sustained commitment to people and culture with its recognition as a Top Employer in Kenya and Africa for the fourth consecutive year by the Top Employers Institute.
The continued cost discipline, combined with strategic investments in customer-focused transformation, resulted in a 1 per cent reduction in total costs to Ksh 5.5 billion. Improved credit performance and effective risk controls led to a 39 per cent decline in impairment charges, which stood at Ksh 1.5 billion. As a result, the Bank maintained strong portfolio quality, supported by a solid coverage ratio to absorb potential future credit losses.
In the quarter under review, the Bank reinforced its long-standing support for sports by investing in key events such as the Magical Kenya Open and the Absa Sirikwa Classics, reaffirming its long-term commitment to the sector and its far-reaching economic benefits.
“Looking ahead, we remain strategically positioned for sustainable growth, anchored by a strong financial foundation and disciplined execution. Our focus is firmly on delivering high-impact, customer-led initiatives while navigating a dynamic external environment. We continue to advance our ambition to position Absa as a forward-looking, innovation-driven financial partner across consumer, SME, and corporate segments. At the same time, we are deepening our digital transformation agenda to enhance customer experience, while strengthening our employee value proposition as a key driver of long-term success,” added Mr. Mohamed.
Return on equity rose to 27 per cent for the period ended 31 March 2025, reflecting the strength of the Bank’s performance and capital efficiency during the quarter.
Ongoing transformational investments and cost discipline contributed to a 1 per cent decline in total costs, which closed at Ksh 5.5 billion. This resulted in an improved cost-to-income ratio of 35 per cent.
Impairment charges declined by 39 per cent to Ksh 1.5 billion year-on-year, underscoring the Bank’s prudent approach to risk management amid balance sheet growth and a dynamic operating environment. Portfolio quality remains strong, supported by a robust coverage ratio to cushion against potential future credit losses.
The Bank maintained a strong capital and liquidity position, with ample buffers above regulatory thresholds. The total capital adequacy ratio stood at 20.4 per cent, while the liquidity reserve ratio closed at 46.9 per cent, comfortably exceeding the regulatory minimums of 14.5 per cent and 20 per cent, respectively. This solid footing provides capacity to fund future growth and investment priorities.
The bank said the next phase of its journey will be defined by sharper execution of customer-led innovations, a stronger digital posture, and a keen focus on long-term value creation across all client segments.
