Standard Chartered Bank Kenya has posted a 26.3 percent drop in profit for the first three months of the year through to March 2026 on lower lending margins, bucking the trend of earnings growth seen among rival listed lenders.
The lender, which becomes the first tier I bank to post a lower profit for the cycle, has booked a net income of Sh3.5 billion, from a higher Sh4.8 billion at the same time last year.
Stan Chart’s net interest income fell by 24.4 percent in the opening quarter to Sh6.2 billion from Sh8.2 billion as revenues from lending fell faster than interest expenses, mirroring the reduction in lending margins.
Revenues from loans and advances to customers declined by 12 percent to Sh3.9 billion from Sh5 billion previously even as the bank’s loan book expanded 19.9 percent to Sh165.3 billion from Sh137.8 billion in March 2025.
Income from government securities, where the bank holds Treasury assets for sale, also fell in the period to Sh2.2 billion from Sh3.4 billion, indicating a dip in revenues from bond sales from the same time last year.
Total interest expenses fell slower than interest income at 7.9 percent with StanChart’s payments to depositors falling slightly to Sh809 million in the quarter from Sh1 billion previously.
The fall in interest expenses was despite the bank’s customer deposits expanding by 12.5 percent in the period to Sh321.1 billion from Sh285.2 billion in March 2025.
The bank marked a 12.1 percent expansion in non-interest funded income to Sh3.7 billion from Sh3.3 billion on higher other fees and commissions, partly offsetting the decline in lending margins.
Standard Chartered non-interest/other operating expenses remained unchanged in the period at Sh4.9 billion on account of slightly higher staff costs which canceled lower loan-loss provisioning costs.
Stan Chart’s first quarter profit decline contrasts to other tier I peers who managed to post higher profits, largely from expanded lending margins even as interest rates fell significantly in the period.
This shows that rival banks were able to cut deposit rates faster than lending margins as general interest rates slid.
Lending margins or profit margins from loan disbursements represent the difference between costs to borrowers and the cost to the bank for holding customer deposits.
KCB Group net profit for the first quarter rose 10.7 percent to Sh17.8 billion on the back of increased interest and non-interest income.
Net interest income for KCB grew 8.6 percent to Sh36.6 billion from Sh33.7 billion as the lender grew its loan book to Sh1.2 trillion from Sh1 trillion.
Equity Group, meanwhile, marked a 19 percent drop in interest costs to Sh10.7 billion from Sh13.3 billion a year earlier, helping the bank to post a 23.8 percent growth in net profit for the opening quarter.
The lender reported a profit of Sh18.3 billion, up from Sh14.8 billion in March 2025.
Standard Chartered Bank Kenya is set to unlock higher revenues from beyond its traditional lending business, this year, if it can sell its current headquarters building in Nairobi at a profit.
The bank has put up the building, valued at Sh1.411 billion and which sits on 1.88 acres, for sale in June 2025.
