I&M Group has posted a 20.2 percent jump in net profit in the first three months of the year to Sh4.7 billion, driven by higher interest income.
The lender’s net income rose from Sh3.9 billion a year earlier as the bank’s revenues from loans accelerated as cost of funds remained flat.
Net interest income for I&M soared 31.1 percent to hit Sh12.2 billion from Sh9.3 billion previously as payments to depositors held flat at Sh.6.1 billion.
Total interest income improved by 19.4 percent, hitting Sh8.4 billion from Sh5.4 billion on higher revenues from loans and advances and government securities, which stood at Sh11 billion and Sh6.6 billion respectively. The higher interest income was achieved as net loans and advances rose 9.9 percent from Sh293.6 billion in March 2025 to Sh322.9 billion.
The flat interest expense base was meanwhile achieved against a 25.8 percent surge in customer deposits to Sh512.1 billion from Sh407 billion.
This implies that I&M was able to mobilise customer deposits at a faster rate without paying a premium to fixed-deposit customers.
Non-interest funded income for the bank topped Sh3.8 billion from Sh3.5 billion previously with the 8.5 percent growth arising largely from higher fees and commissions on loans and advances.
I&M achieved a 24.8 percent growth in total operating income over the three-months period to Sh16.1 billion from Sh12.9 billion in March 2025.
The lender’s non-interest/other operating expenses rose by 36.1 percent to Sh9.8 billion from Sh7.2 billion previously. The higher other operating expenses were obtained mostly from a 73.3 percent pick up in loan-loss provisioning costs to Sh2.6 billion, nearly doubling from Sh1.5 billion a year ago.
The rise in costs related to expected credit losses was despite the bank’s gross non-performing loans (NPLs) falling to Sh31.5 billion from Sh34.4 billion previously.
I&M has followed other tier-one banks by posting a higher opening quarter profit from improved interest income even as borrowing costs fell in the first three months of the year.
KCB Group’s profit in the same period rose 10.7 percent to Sh17.8 billion on the back of increased interest and non-interest income. On its part, Equity Group posted a profit of Sh18.3 billion in the quarter from Sh14.8 billion previously as its interest expenses fell 19 percent to Sh10.7 billion.
Commercial banks have shown their agility to navigate both high and low interest rates regimes whilst sustaining steady lending margins. Standard Chartered Bank Kenya however bucked the trend as its first quarter profit fell 26.3 percent to Sh3.5 billion from Sh4.8 billion on a faster drop in lending rates than customer deposits’ costs.
