Standard Chartered Bank Kenya Plc has recorded a narrowed net profit of Ksh. 3.58 billion for the first quarter of 2026. This is a 1.48% drop from the Ksh. 4.86 billion that the bank recorded in the same period in 2025.
The performance reflects a challenging operating environment defined by thinner margins and a normalization of revenue streams following lower market interest rates.
According to the lender’s latest Q1 financial results, Earnings Per Share (EPS) slid by 26.59% to Ksh. 9.36. The squeezed performance comes shortly after the bank issued a profit warning for the 2025 end-year, driven largely by a substantial pensions liability.
Q1 2026 key performance metrics
| Metric | Q1 2025 | Q1 2026 | Year-on-Year (YoY) Change |
| Total Operating Income | Ksh. 11.60 Bn | Ksh. 10.03 Bn | ▼ 13.48% |
| Profit Before Tax | Ksh. 6.64 Bn | Ksh. 5.09 Bn | ▼ 23.31% |
| Net Profit | Ksh. 4.86 Bn | Ksh. 3.58 Bn | ▼ 26.32% |
| EPS (Basic & Diluted) | Ksh. 12.75 | Ksh. 9.36 | ▼ 26.59% |
| Total Operating Expenses | Ksh. 4.96 Bn | Ksh. 4.94 Bn | ▼ 0.31% |
| Loan Loss Provision | Ksh. 412.52 Mn | Ksh. 327.00 Mn | ▼ 20.74% |
| Staff Costs | Ksh. 2.18 Bn | Ksh. 2.29 Bn | ▲ 4.87% |
The primary catalyst for the earnings contraction was a 23.31% decline in net interest income, which fell to Ksh. 6.29 billion. This was driven by a faster tapering of interest income compared to the reduction of interest expenses.
Total interest income fell to Ksh. 7.22 billion, fueled by a drop in income from loans and advances. Analysts noted that this drop occurred despite a sizeable 19.96% jump in the bank’s net lending portfolio, highlighting severe margin compression. Additionally, interest income from government securities eased, a shift attributed to lower government bond yields over the period.
On the liability side, Standard Chartered managed to lower its interest expenses by 15.13% to Ksh. 921.88 million. This mitigation was anchored by a downturn in interest paid on customer deposits, as the bank strategically fully transmitted Central Bank Rate (CBR) cut benefits to its clients and capitalized on its expanding, low-cost deposit base.
Core banking income and balances
| Financial Element | Q1 2025 | Q1 2026 | Year-on-Year (YoY) Change |
| Interest Income | Ksh. 9.29 Bn | Ksh. 7.22 Bn | ▼ 22.35% |
| Interest Expenses | Ksh. 1.09 Bn | Ksh. 921.88 Mn | ▼ 15.13% |
| Net Interest Income | Ksh. 8.21 Bn | Ksh. 6.29 Bn | ▼ 23.31% |
| Non-Interest Income | Ksh. 3.39 Bn | Ksh. 3.74 Bn | ▲ 10.32% |
| Loans & Advances (Net) | Ksh. 137.86 Bn | Ksh. 165.38 Bn | ▲ 19.96% |
| Customer Deposits | Ksh. 285.21 Bn | Ksh. 321.15 Bn | ▲ 12.60% |
| Total Assets | Ksh. 382.26 Bn | Ksh. 413.27 Bn | ▲ 8.11% |
| Shareholders’ Equity | Ksh. 76.09 Bn | Ksh. 69.82 Bn | ▼ 8.23% |
While the lender’s overall operating income narrowed, its non-interest revenue lines provided a much-needed buffer. Non-funded income edged higher by 10.32% to Ksh. 3.74 billion, lifted by robust transaction activity across several segments. Fee and commission income from Global Markets, Global Banking, Transaction Services, and Wealth Solutions rose.
Conversely, fees and commissions specifically tied to loans and advances plummeted by 38.5% to Ksh. 39.3 million. Foreign exchange trading income also faced headwinds, sliding 24.4% to Ksh. 780.4 million due to reduced volatility and tighter margins in the local FX market. However, other operating income jumped 34.1% to Ksh. 933.2 million, driven by strong growth in the bank’s bancassurance, wealth management, and securities trading desks.
Balance sheet strength and asset quality
| Balance Sheet Metric | Q1 2025 | Q1 2026 | Year-on-Year (YoY) Change / pp |
| Gross NPLs | Ksh. 12.21 Bn | Ksh. 8.95 Bn | ▼ 26.74% |
| Net NPL Exposure | Ksh. 477.93 Mn | Ksh. 161.45 Mn | ▼ 66.22% |
| Core Capital Ratio | 20.56% | 18.80% | ▼ 1.76pp |
| Total Capital Ratio | 20.63% | 18.85% | ▼ 1.78pp |
| Liquidity Ratio | 73.64% | 66.33% | ▼ 7.31pp |
On the operational efficiency and balance sheet quality front, Standard Chartered recorded notable structural successes. Operating costs were strictly contained, with total operating expenses marginally down by 0.31% to Ksh. 4.94 billion, despite a 4.87% increase in staff costs to Ksh. 2.29 billion.
Crucially, gross Non-Performing Loans (NPLs) decreased significantly by 26.74% to Ksh. 8.95 billion, leading to a massive 66.22% reduction in Net NPL Exposure down to Ksh. 161.45 million. This improvement in asset quality allowed the bank to drop its loan loss provisions to Ksh. 327.00 million, lowering the bank’s cost of risk and partially cushioning the final bottom line.