Consolidated Bank of Kenya Limited posted a profit after tax of KShs 7.6 million for the six months ended June 2025, reversing a KShs 84.5 million loss in the same period last year.
- •The turnaround was driven by improved group net interest income, up 21% to KShs 551.4 million from KShs 455.4 million in H1 2024.
- •There was also a marginal 3.19% rise in loan loss provisions to KShs 161.9 million from KShs 156.9 million, despite a still-high non-performing loan book.
- •Once a persistently loss-making lender, Consolidated Bank has struggled with capital adequacy challenges but is showing signs of operational recovery, aided by tighter cost control and improved liquidity.
Total operating income rose 8% to KShs 833.5 million, with interest income from government securities jumping 52% to KShs 359.8 million, offsetting a modest 7.47% decline in loan interest to KShs 589.4 million. Non-interest income dipped 10.8% to KShs 282.0 million, reflecting a softer foreign exchange and lower trading fees.
Operating expenses eased slightly to KShs 811.8 million from KShs 848.1 million, supported by lower rental charges and slower growth in staff costs, which fell by 1.4% year-on year.
Balance Sheet Expansion Amid Capital Deficit
Total assets grew 18.5% year-on-year to KShs 18.40 billion, driven by higher holdings of government securities (+74.24% to KShs 7.54 billion) and a modest increase in customer deposits (+7.9% to KShs 12.01 billion).
However, the bank remains in breach of minimum capital requirements, with a core capital to total risk-weighted assets ratio of -6.1%, far below the statutory 10.5% threshold, leaving a deficit of 16.6 percentage points. This is a continuation of the capital shortfall seen in FY 2024, when core capital and total capital ratios stood at -5.8% against statutory minimums of 10.5% and 14.5%, and accumulated losses reached KShs 4.43 billion at group level.
Going Concern Considerations
The bank’s capital deficiency and historical losses have raised material uncertainty over its ability to continue as a going concern. In FY2024, the Group posted a KShs 155 million loss (Bank: KShs 163 million) compared to a KShs 415 million loss in FY 2023, with accumulated losses rising to over KShs 4.4 billion. Nevertheless, the Board and management remain confident in the bank’s long-term viability, citing a 2023-2027 turnaround plan anchored on five strategic pillars: business growth, brand positioning, people, asset quality, and technology leverage.
A critical component of the plan is securing additional capital. The National Treasury- holding a 93.4% stake- has reaffirmed its commitment to inject fresh equity to restore regulatory compliance and finance growth. Management expects this capital support, coupled with operational restructuring, to sustain the bank’s going concern status.
Improved Liquidity Cushion
At the same time, liquidity strengthened significantly, with the liquidity ratio rising to 30.2%, comfortably above the statutory minimum of 20% and marking a sharp improvement from 17.8% in June 2024.
Key Highlights- H1 2025 vs H1 2024
| Indicator | H1 2025 | H1 2024 | Y-o-Y Change |
| Net Interest Income | KShs 551.4 Million | KShs 455.4 Million | +21.1% |
| Non-Interest Income | KShs 282 Million | KShs 316 Million | -10.8% |
| Total Operating Income | KShs 833.5 Million | KShs 771.3 Million | +8.1% |
| Loan Loss Provisions | KShs 161.9 Million | KShs 156.9 Million | +3.2% |
| Operating Expenses | KShs 811.8 Million | KShs 848.1 Million | -4.3% |
| Profit After Tax | KShs 7.6 Million | (KShs 84.5 Million) | Reversal to Profit |
| Total Assets | KShs 18.40 Billion | KShs 15.53 Billion | +18.5% |
| Customer Deposits | KShs 12.01 Billion | KShs 11.13 Billion | +7.9% |
| Liquidity Ratio | 30.2% | 17.8% | +12.4 pp |
The H1 2025 performance reflects gradual operational improvement, but the bank’s structural weakness in capitalization remains a pressing challenge. The high ratio of non-performing loans (gross NPLs at KShs 3.79 billion) continues to constrain balance sheet growth.
Still, stronger liquidity, improved net interest margins, and modest cost control provide a foundation for cautious optimism. The focus in H2 will likely remain on shoring up capital buffers, recovering delinquent loans, and sustaining the profitability trend- backed by shareholder support and execution of the ongoing turnaround strategy.
