Sidian Bank has posted a profit after tax of Sh607.03 million for the quarter ended 31 March 2026, up 9.0% from Sh556.94 million in the same period a year earlier, extending a profit recovery that has reshaped the lender’s standing in Kenya’s banking sector over the past two years.
Net interest income more than doubled to Sh1.61 billion from Sh736.58 million in Q1 2025, driven by a 61.9% surge in total interest income to Sh2.88 billion as the bank continued to harvest returns from a government securities book that now anchors its balance sheet.
Interest expense rose 21.8% to Sh1.27 billion, a markedly slower pace that kept the cost of funds contained despite the expanded deposit base.
The results are the first quarterly filing under incoming CEO John Okulo, who joined from KCB Bank Kenya on 1 May 2026, succeeding Chege Thumbi, who retires on 30 June after nine years that transformed a sub-scale Tier 3 lender into a mid-tier institution with Sh94 billion in assets.
Total assets grew 38.1% to Sh94.08 billion from Sh68.12 billion, while customer deposits rose 47.6% to Sh74.16 billion from Sh50.25 billion. The deposit trajectory captures a broader transformation: from Sh16.52 billion in March 2019 to Sh74.16 billion today, the bank has grown its deposit base more than fourfold in seven years, with the sharpest acceleration coming in the 24 months to March 2026.
The engine behind that acceleration is a string of public sector mandates. Nairobi County Government designated Sidian as its principal banker in October 2025, shifting health facility revenues, donor fund management and the Facility Improvement Fund away from Co-operative Bank and Equity Bank.
The deposit wave has been channelled predominantly into Treasury bills and bonds rather than the loan book.
The bank also serves as a receiving agent for the Social Health Authority and the housing levy and holds primary banking relationships with Kenya Railways and KEMSA. In March 2026, Nairobi MCAs approved a Sh1.7 billion monthly payroll overdraft facility with Sidian, deepening City Hall’s reliance on the lender.
The deposit wave has been channelled predominantly into Treasury bills and bonds rather than the loan book. Net loans and advances edged up 11.9% to Sh29.38 billion, a modest expansion relative to the balance sheet growth, while investment securities stood at Sh9.94 billion.
Gross NPLs declined slightly to Sh8.25 billion from Sh8.65 billion in March 2025, and net NPL exposure fell sharply to Sh77.75 million from Sh137.57 million.
Non-interest income contracted 45.9% to Sh557.34 million from Sh1.03 billion, with other income collapsing from Sh662.37 million to Sh48.28 million. Every other non-interest line grew, suggesting a one-off gain in Q1 2025 that did not recur rather than any deterioration in fee-generating capacity.
Capital strength improved markedly, with core capital jumping to Sh11.77 billion, lifting the core capital adequacy ratio to 19.6% from 12.2% a year earlier, following the Sh3 billion rights issue completed in two tranches in January and February 2026. The liquidity ratio stood at 76.9%, nearly four times the 20.0%