Mwangi's Sh734m windfall as Equity posts record earnings

Equity Group Chief Executive James Mwangi. [File, Standard]

Equity Group Chief Executive James Mwangi will be walking home with over Sh734 million as dividend for the year that ended on December 2025, as the bank posted a record profit of Sh75.5 billion after tax. 

Additionally, the company’s employees will share close to Sh700 million through the Equity Bank Employee Share Ownership Plan.

From the 2024 disclosures, Mwangi had a 3.39 per cent stake in the business with 127.8 million shares. Equity Bank employees own 3.21 per cent which is equivalent to 121.3 million shares.

The record profit after tax of Sh75.5 billion for the year represented a 55 per cent growth over the period, pushing the bank to be the first company in the Eastern Africa region to post such earnings after tax.

The bank will pay shareholders a record dividend totaling Sh21.7 billion, up from Sh16.04 billion paid in 2024.

While Equity Bank Kenya contributed the most in this profitability pot with the business posting a profit after tax of Sh39.2 billion, growth was also evident in the rest of the subsidiaries.

Equity Bank Uganda profit after tax grew by 500 per cent to hit Sh3.6 billion while Equity Bank Tanzania improved by 125 per cent to record Sh2.7 billion profit.

The Democratic Republic of Congo subsidiary grew its profit after tax by 58 per cent to Sh24.7 billion while South Sudan saw a dip to record a loss of Sh100 million as Rwanda flattened at Sh5.4 billion.

Kenya’s subsidiary profit after tax grew by 63 per cent.

In the period, despite the reduced base lending rate by the Central Bank of Kenya (CBK), the bank managed to grow its net interest income by 17 per cent to Sh126.9 billion.

Total income for the bank improved by 12 per cent to Sh217.7 billion.

“Equity has broken the corporate record of profitability,” said Mwangi during an investor briefing in Nairobi yesterday.

“No bank or company in East and Central Africa has ever recorded a profit after tax of Sh75.5 billion. We are now the most profitable company ever in the region.”

Mwangi explained that the growth in net interest income was more of a defensive strategy.

“The defensive strategy was how do we reduce the cost of funding, how do we improve the topline? The topline was not about growth but efficiency. We reduced our cost of funding by 24 per cent but we continued with our offensive to grow,” he said.

As the interest income grew by two per cent to Sh173.6 billion, non-funded income grew by seven per cent to Sh90.8 billion.

Mwangi also noted an improvement in the quality of loans issued during the period, which improved the bank’s non-performing loans (NPL) ratio.

“We saw an improvement in quality of loans significantly from 14 per cent in January to 10.5 per cent. That ensured we reduced our loan loss provision,” he said.

In the first quarter of the year, when the NPL ratio stood at 14 per cent, the absolute size of the NPLs was 124.7 billion. This dropped to Sh99.6 billion in the fourth quarter of the year in review, hence the 10.5 per cent ratio.

Compared to 2024 when the loan loss provision was Sh20.2 billion, in 2025 this dropped to Sh14.5 billion.

Profit attributable to shareholders in the period grew to Sh72 billion from Sh46.5 billion with earnings per share going up from Sh12.3 to Sh19.1.

Dividend per share for the period closes at Sh5.75 compared to Sh4.25 in 2024, an increase of 35 per cent.

“Dividend payment is Sh6 billion high. Last year it was Sh16 billion, this year, we will be paying the highest record dividend ever in the history of Equity at Sh22 billion,” said Mwangi.