💸 Kenya’s Lending Slowdown

In Nairobi’s financial hubs, lending desks are taking a back seat as risk teams step into the spotlight. Kenya’s banking story in 2024 isn’t one of expansion—but of retreat.

🚨 The Shift: From Bold Lending to Defensive Play

Once known for aggressive loan growth—fueling SMEs, real estate, and fintech—Kenyan banks are now pumping the brakes. Out of 10 top banks, 9 have slashed their net customer loans:

😬 What’s Behind the Pullback?

NPL Surge Rising non-performing loans have banks on edge. ABSA’s NPLs jumped 20.5%, HF’s 10.6%, KCB 8.4%, and Equity 6.5%. Risk appetite? Shrinking.

lets explore the gross non performing loans (Gross NLPs) Ranked by the reduced NLPs.

Bank	FY23 (Ksh Bn)	FY24 (Ksh Bn)	Change
StanChart	17.2	12	-30.2%
NCBA	44.6	37.2	-16.6%
Stanbic	26.5	22.6	-14.4%
DTB	43.6	37.9	-13.3%
I&M	35.4	35.5	0.4%
Co-op	66.9	71.1	6.2%
Equity	114.6	122	6.5%
KCB	208.3	225.7	8.4%
HF Group	10.8	12	10.6%
ABSA	35.4	42.5	20.5%

Bottom Line:

StanChart, NCBA, and Stanbic are setting the pace in cleaning up their balance sheets—an early sign of recovery and strategic risk management. But for others, especially ABSA and KCB, the rising NPLs point to ongoing credit pain and a long road ahead. This divergence underscores the evolving nature of risk in Kenya’s banking sector—where resilience isn’t just about size, but about how aggressively institutions manage what’s already gone wrong.

📉 It’s not just numbers—it’s a mindset shift. The focus is now on stability, not scale.

🧊 The Freeze in Numbers (The Loan Book)

KCB slashed lending by over Ksh 105B, more than some banks’ total loan books. Even Equity—once the poster child for inclusive lending—cut nearly Ksh 68B. Meanwhile, STANBIC (-11.6 %), KCB(-9.6%), and NCBA (-10.4%) are in deep cleanup mode.

lets explore the Net Customer Loans & Advances in detail:

Bank	2023	2024	Growth
HF	38.8	38.9	0.2%
COOP	374.2	373.7	-0.1%
StanChart	163.2	151.6	-7.1%
DTB	308.5	285.3	-7.5%
EQUITY	887.38	819.2	-7.7%
I&M	311.3	287.1	-7.8%
ABSA	335.7	309.1	-7.9%
KCB	1095.9	990.4	-9.6%
NCBA	337	302.1	-10.4%
STANBIC	260.5	230.2	-11.6%

✨ The Outliers

1. HF Group: The only lender with positive growth (+0.2%)—thanks to its niche focus on housing.

2. Co-operative Bank: Minimal dip (-0.1%), likely due to its unique cooperative model and customer base.

These banks show that sector specialization and strong borrower insight might be the future of smart lending.

🚨Non-Performing Loans vs. Net Customer Loans (2024)

To get a clearer picture of the pressure points in Kenya's banking sector, it helps to compare how much banks have lent out versus how much of that is already troubled.

Key Takeaway:

KCB’s 22.8% NPL to Net Customer loans ratio is the highest, with nearly a quarter of its loan book under distress. Co-op and Equity also face significant credit stress, while StanChart and Stanbic remain on the lower end of risk exposure. This breakdown highlights why caution has become the new normal. High NPL ratios aren’t just a financial red flag—they’re a strategic signal reshaping how credit is priced, approved, and managed.

🧾 Conclusion: Risk Over Returns

Kenya’s banking sector in 2024 is no longer chasing growth—it’s dodging landmines. As non-performing loans balloon, lending has cooled, and risk management has become the name of the game. The numbers speak volumes: even the largest players like KCB and Equity are tightening their belts, signaling that credit caution is not a trend—it’s a transformation.

But amid the turbulence, a few are charting a different path. StanChart, NCBA, and Stanbic are quietly cleaning house, showing that strategic restraint may be the ultimate competitive edge. Meanwhile, niche players like HF Group and Co-op prove that focused, relationship-driven lending can still shine.