AfDB, KCB in Sh19b deal to boost economy
Business
By
Brian Ngugi
| Dec 12, 2025
The African Development Bank Group (AfDB) and KCB Bank Kenya Ltd have signed a $150 million (Sh19.3 billion) financing package to accelerate climate-friendly lending and boost trade finance. The funding targets small businesses and corporate borrowers.
The deal, announced on Thursday, is designed to increase the flow of capital to projects that support environmental sustainability, commonly referred to as green finance. This includes investments in renewable energy, climate-smart agriculture, and green infrastructure.
The package comprises a $100 million (Sh13 billion) subordinated debt facility to strengthen KCB’s capital base, enabling more long-term lending, and a $50 million (S6.5 billion) transaction guarantee to mitigate risks for international banks confirming KCB’s trade finance instruments like letters of credit.
“This facility is a testament to our shared commitment to advancing Africa’s green transition and ensuring that economic growth goes hand in hand with environmental stewardship,” said AfDB Director General for East Africa Alex Mubiru. The partnership aims to expand access to finance for small and medium-sized enterprises (SMEs), women-led businesses, and projects that build resilience against climate shocks.
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It aligns with KCB’s goal to allocate 25 per cent of its loan portfolio to green initiatives by 2031. “This partnership marks a significant milestone in our sustainability journey as it reinforces our commitment to scale up green lending,” said KCB Bank Kenya Managing Director Annastacia Kimtai.
She noted it would help catalyse private investment toward Kenya’s national goal of achieving net-zero carbon emissions by 2050.
The agreement reflects a growing focus on sustainable finance in Africa’s largest economies. KCB, which is Kenya’s biggest bank by assets, has already been expanding its green portfolio, which grew to 21.32 per cent of its book in 2024 from 15 per cent a year earlier.
Last year, KCB says it disbursed $402 million (Sh52 billion) in green loans for projects in sectors like electric mobility, the blue economy and fresh water resources.