Sidian Bank’s net profit grew 4.5 times in the six months to June 30, 2025, mainly fueled by non-interest income.
The bank, partly owned by listed investment firm Centum, reported a net profit of Sh1 billion for the six months, up from Sh221 million posted in the same period last year.
The rapid growth saw the bank’s ratio of total capital to total risk-weighted assets shrink to 15.3 percent, being 0.8 percent above the statutory requirement of 14.5 percent.
With the headroom, the bank’s shareholders might be forced to inject extra capital or slow down its growth while cleaning up the loan book.
Owners have injected Sh3 billion in the last 18 months as it boosted capital to match business growth.
Customer deposits with the small-tier bank rose 70.8 percent in the year to June to Sh59.8 billion. The bulk of the deposits were invested in Treasury bills and bonds, with the bank’s portfolio of government securities tripling to Sh39.3 billion over the 12 months.
The bank’s earnings from government securities rose to Sh1.8 billion from Sh875 million, underlining the portfolio growth.
Sidian’s loan book grew, 4.8 percent, to Sh26.9 billion, indicating the bank's conservative approach in a tough economic environment that has seen its bad loans balloon. The bank's pile of bad loans was Sh6.6 billion, being 24.8 percent of its total loan book.
Sidian’s ratio of non-performing loans was higher than the sector average of 17.2 percent, forcing it to hold higher loan loss provisions at Sh492.5 million, which ate into its profitability and required it to hold higher capital ratios.
Sidian’s growth has seen its market share in the banking industry rise to 0.7 percent as at the end of last year. It ranked second among small peer banks, up from position seven in 2023.
Sidian Bank got new shareholders last year who have injected new capital in the lender to drive growth with ambitions of being a mid-tier bank by 2028, which requires it to have at least one percent market share.
The bank's shareholding structure has changed significantly over the capital raising period, with Centum’s stake, held under Bakki Holdco Limited, diluted to 27.27 percent from 40 percent.
Pioneer General Insurance owns 16.89 percent, and its sister company, Pioneer Life Investments, owns 3.06 percent. Other shareholders are Afram Limited, 24.3 percent, Wizpro Enterprises Limited, 24.95 percent, and Telesec Africa, 3.47 percent.
