Stanbic Kenya doubles its interim dividend to KSh 3.8 per share, citing strong capital position, despite a 9% drop in half-year profit.
Stanbic Kenya Doubles Dividend Despite Profit Decline
NAIROBI – Stanbic Holdings Plc, the Kenyan subsidiary of Standard Bank Group Ltd., has more than doubled its interim dividend payout, citing a strong capital position and an improved medium-term growth outlook.
The lender will pay shareholders KSh 3.80 ($0.03) per share for the six months ending June 2025 — a sharp increase from KSh 1.84 a year earlier. This decision comes even as net profit slid 9% to KSh 6.54 billion ($50.5 million), down from KSh 7.19 billion in the same period last year.
Capital Deployment Over Profit Preservation
Stanbic said the decision reflects a deliberate choice to deploy unused capital productively rather than hold excess buffers.
“We remain confident in the resilience of our balance sheet and our ability to sustain shareholder returns, even in a challenging interest rate environment,” said Joshua Oigara, Stanbic Bank Kenya Chief Executive.
The dividend payout represents a 106% increase from last year, signalling management’s optimism in revenue recovery from new lending segments and growth in non-interest income streams.
Interest Rates Pressure Loan Margins
The bank attributed the earnings decline to lower lending rates, which reduced income from loans and advances. According to the lender, net interest income fell by 4% year-on-year, while non-performing loans (NPLs) edged up to 9.1% from 8.4% in 2024.
However, income from foreign exchange trading and transaction banking provided a cushion, contributing to a 6% rise in non-interest revenue.
Regional Ambitions and Digital Push
Stanbic Kenya, part of Africa’s largest bank by assets, is deepening its focus on regional integration and digital transformation.
In 2025 alone, the lender has invested over KSh 2.5 billion ($19.3 million) in expanding its digital banking platforms, with customer transactions through mobile and online channels growing by 21%.
“Our strategy remains anchored on enabling growth for individuals and businesses across East Africa, leveraging Standard Bank Group’s continental footprint,” Oigara said.
Market Outlook
Analysts at Renaissance Capital note that Stanbic’s aggressive dividend move may boost investor confidence but also puts pressure on future capital adequacy if earnings remain under strain.
Stanbic Holdings shares on the Nairobi Securities Exchange closed at KSh 110.50 on Monday, up 3.2% following the dividend announcement.
