Consolidated Bank of Kenya shook off boardroom wrangles to continue with its financial turnaround reporting a Sh80.2 million profit for the nine months ended September 2025.
The government-owned bank, which currently lacks both a substantive board of directors or chief executive, rode on interest earnings from Treasury bills and bonds to reverse a Sh131.9 million net loss reported in the same period a year earlier.
After more than a decade of loss-making, which eroded its capital levels to below regulatory requirements, the bank returned to profitability in the six months to June this year.
However, in October, the bank failed to renew the contract of the Sam Muturi, the CEO who turned it around, and is yet to appoint a substantive replacement.
The National Treasury, which owns 93.5 percent of Consolidated Bank, appointed Dr Dominic Njeru, a lecturer at the University of Nairobi, on an interim basis. Dr Njeru’s appointment has, however, been stalled by the Central Bank of Kenya (CBK) as he is yet to receive the regulator’s nod on fit and proper test.
The Treasury Cabinet Secretary, John Mbadi, also revoked the appointment of three directors of the bank, leaving the lender without a substantive board.
Notably, the bank’s financial statements were signed by the sole remaining board member, Florence Oluoch, with no executives present.
More than half of the bank’s top management – six out of eleven – are serving in an acting capacity, which denies them full authority to execute their roles.
“The performance was driven by 27 percent growth in [net interest income] from Sh711 million to Sh903 million. A rise in interest income from government securities to Sh583 million from Sh278 million and a decline in interest expense by nine percent to Sh581 million drove up the interest income,” said the bank’s acting head of finance, Fred Ronoh.
Consolidated Bank held Sh8 billion in government securities up from Sh4.6 billion a year earlier. The bank’s loan book shrunk 2.3 percent to Sh8.2 billion as banks took a more cautious approach to lending in a tough economy where defaults have been growing.
Consolidated bank’s borrowings from CBK nearly doubled at Sh5.8 billion up from Sh3 billion, signalling increased reliance on regulator funds to conduct business.
The bank is still optimistic that the government will inject additional capital to make it compliant to regulatory requirements and give it space to grow its business.
“The bank is well positioned for… continued focus on customer needs even as the shareholders remain committed to support and ensure that the bank is adequately capitalised to meet minimum regulatory requirements,” said Mr Ronoh.
Consolidated Bank has been waiting on the Treasury to inject cash for over a decade, forcing it to rely on cost cutting to stay afloat rather than business growth.
