Co-op Bank leads list of Kenyan lenders in Forbes World top 500

Co-operative Bank posted its strongest-ever half-year performance with a 28 per cent rise in net profit to Sh18 billion. [File, Standard]

Four top Kenyan banks have been ranked among the world's top 500 performing lenders in the inaugural Forbes World's Top Performing Banks 2026 list.

This is a rare endorsement of the sector's resilience as Kenya's broader economy battles slowing growth, elevated inflation and a punishing credit environment.

Co-operative Bank of Kenya, Equity Group Holdings, KCB Group and Stanbic Holdings were included in the ranking of 500 banks from 89 countries, published on Wednesday by Forbes in partnership with market research firm Statista.

In the list reviewed by The Standard, Co-operative Bank led the pack, followed by Equity Bank, KCB Group and finally Stanbic Holdings.

The four lenders were evaluated across four dimensions. Profitability was weighted at 30 per cent and calculated by combining return on average assets, cost-to-income ratio and net interest margin.

Growth and earnings quality was weighted at 20 per cent, factoring in earnings growth and stability alongside customer deposit growth over three-year periods. Capital and funding resilience was weighted at 25 per cent, based on equity ratio and loan-to-deposit ratio.

Asset quality and efficiency was weighted at 25 per cent, as well as assessing credit quality, risk management and balance sheet resilience.

To qualify, banks had to be licensed deposit-taking institutions with lending as a core business, report under reconcilable national accounting standards, publish audited financial statements and provide at least three consecutive years of financial data, with total assets exceeding $3 billion (Sh390 billion).

Banks were then classified into six tiers based on asset size, from global lenders with more than $500 billion (Sh65 trillion) in assets down to small banks with $3 billion (Sh390 billion to $10 billion 1.3 trillion).

Co-operative Bank of Kenya, headed by the Group's Chief Executive Gideon Muriuki, posted its strongest-ever half-year performance with a 28 per cent rise in net profit to Sh18 billion in the period to June 30, 2026, from Sh14.1 billion a year earlier.

"This strong performance underscores the significant gains made under our 2025-2029 Good to Great Strategy and the 'Soaring Eagle' Transformation Agenda," Muriuki said.

The bank added 741 net new jobs, raising its workforce to 6,591, and formalised a dedicated youth financial services division targeting over 10 million young customers.

Kingdom Bank, Coop Bank's retail subsidiary, nearly doubled pretax profit to Sh873 million, while fund management arm Co-optrust Investment Services grew pretax profit by 77.5 per cent to Sh640.5 million.

The group's non-performing loans ratio improved to 13.9 per cent from 17.2 per cent, with total assets expanding 7.1 per cent to Sh869.5 billion.

Equity Group Holdings led by its Chief Executive James Mwangi, reported a 32 per cent surge in first-half net profit to a record Sh43.80 billion, driven by balance-sheet expansion and a 36 per cent jump in non-funded income to Sh55.6 billion, now accounting for 44.5 per cent of total income.

"Equity's half-year 2026 performance is the outcome of a multi-year transformation agenda focused on resilience, diversification, and technology enablement," Mwangi said. "The Group has repositioned its operating model, strengthened its regional presence, and invested heavily in digital and AI-enabled capabilities to build an institution equipped for the future".

KCB Group, Kenya's largest bank by assets and headed by CEO Paul Russo, posted a 20.8 per cent rise in first-half profit before tax to Sh49.3 billion, with total assets reaching Sh2.3 trillion.

The board declared an interim dividend of Sh3 per share, a 50 per cent increase, totalling Sh9.64 billion. "Our strong half-year performance reflects the resilience of KCB Group's diversified business model, the strength of our regional footprint, and the confidence our customers continue to place in us," Russo said earlier.

"Despite a tough operating environment, we remain committed to supporting businesses and households, accelerating digital transformation and creating long-term sustainable value for our shareholders and the communities which we serve".

Stanbic Holdings, led by Chief Executive Joshua Oigara, who took the helm in March 2026, reported a profit after tax of Sh6.6 billion for the first half, with total assets growing 27 per cent to Sh602 billion and customer deposits rising 28 per cent to Sh422 billion.

"Our performance in the first half demonstrates the discipline and resilience that continue to define our business. We remain well capitalised, deeply customer centric, and steadfast in our commitment to supporting Kenya's economic growth," Oigara said.

The recognition comes as Kenyan banks continue to  defy a gloomy economic outlook. The Central Bank of Kenya cut its 2026 GDP growth projection to 4.9 per cent from an earlier 5.3 per cent, citing the disruptive impact of the Middle East conflict on global supply chains and surging energy prices.

Diaspora remittances dropped 3.03 per cent to $2.44 billion (Sh317 billion) in the first half, the weakest six-month performance in nearly two decades.

The sector's gross non-performing ratio stood at 15.6 per cent in March 2026, according to World Bank data, with non-performing loans holding in the 23-24 per cent band for six consecutive months.

Yet Kenya's top lenders have posted record profits, supported by falling interest rates, aggressive loan recovery efforts and growing contributions from regional subsidiaries.

The CBK's benchmark rate has been held at 8.75 per cent, with the average commercial bank lending rate falling to 14.5 per cent in May 2026 from 17.2 per cent in November 2024.

The Forbes ranking also highlighted other African lenders, with Zimbabwe's CBZ Bank taking the top position in its peer group and Egypt's Commercial International Bank placing second among mid-size banks, challenging assumptions that African banking is defined solely by risk and weak institutions.