Kenya’s nine largest banks are set to distribute a record Sh85 billion in dividends to shareholders in 2024.
The move is due a surge in profits driven by higher lending rates and increased loan costs.
The banking sector’s strong performance comes amid rising interest rates, which have significantly boosted lenders’ income from loans.
This has translated into massive shareholder rewards despite concerns over the affordability of credit for borrowers.
Standard Chartered Bank (StanChart) leads the dividend payout with Sh17 billion, followed closely by Equity Bank at Sh16 billion.
KCB Group will pay Sh9.6 billion, while Absa Bank Kenya and NCBA Group have declared dividends of Sh9.5 billion and Sh9 billion, respectively.
Other major lenders joining the high-payout club include Co-operative Bank (Sh8.8 billion), Stanbic Bank (Sh8 billion), I&M Bank (Sh5 billion), and Diamond Trust Bank (DTB), which will distribute Sh1.9 billion.
Analysts attribute the surge in earnings to the Central Bank of Kenya’s tightening of monetary policy, which has led to higher lending rates and increased bank profitability.
Industry observers warn that sustained high-interest rates could dampen credit demand, potentially slowing down economy.
