NCBA Group has raised its interim dividend by 50 percent after posting a 12.2 percent growth in half-year net profit, underlining the lender's strong earnings momentum even as it increased provisions for bad loans.

The lender on Wednesday announced an interim dividend of Sh3.75 per share, up from Sh2.50 paid at the same time last year, after reporting a net profit of Sh12.4 billion for the six months ended June 2026, compared with Sh11 billion a year earlier.

The improved earnings were driven by a 15.1 percent rise in operating income to Sh40.7 billion, supported by higher interest earnings from customer loans and government securities.

Customer deposits grew 11 percent to Sh551.4 billion, while total assets expanded by 11.5 percent to Sh739 billion.

The performance comes as NCBA prepares for a new ownership structure following the successful conclusion of Nedbank's tender offer for a 66 percent stake in the Kenyan lender.

The transaction, valued at Sh116.3 billion, attracted applications exceeding the targeted shares, with the offer oversubscribed by 121 percent. Completion now awaits the remaining regulatory approvals.

NCBA Group Managing Director John Gachora said the bank had remained resilient despite a challenging operating environment.

“The first half of 2026 was marked by a dynamic operating environment with pressure on inflation and a cautious policy approach by the regional Central Banks,” said Mr Gachora.

Read: NCBA posts Sh22bn profit, raises dividend for fourth straight year

“Our focused execution of the UBUNTU strategy has ensured that we delivered a resilient total income growth of 15.1 percent reflecting healthy business volumes, improved margins and continued customer activity,” he said.

The lender, however, raised its provisions for expected credit losses to Sh5.2 billion from Sh3.2 billion a year earlier, reflecting continued caution over the operating environment.

Even so, its non-performing loan ratio stood at 10.5 percent, below the Kenyan banking sector average of 15.3 percent.

“We have increased provisions to Sh5.2 billion reflecting the realities of the current operating environment, which positions us well to absorb potential,” Mr Gachora said.

Beyond its financial performance, NCBA continued to invest heavily in growth initiatives.

The bank spent Sh2.4 billion on technology infrastructure to accelerate artificial intelligence adoption, strengthen cyber security and improve digital service reliability, achieving a system uptime of 99.68 percent.

The lender also expanded its wealth management business, with assets under management surpassing Sh101 billion, while mobile banking accounted for 94 percent of all transactions.

Lending to small and medium-sized enterprises grew 12 percent to Sh44.7 billion, while the retail loan book surged 54 percent.

Its Kenyan banking subsidiary remained the group's largest profit contributor, recording a 24.3 percent increase in profitability to Sh13.7 billion, while regional operations in Uganda, Tanzania and Rwanda posted a combined Sh1.6 billion profit, supported by strong loan growth.

→ dakure@ke.nationmedia.com

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