I&M Group Cleared US$79 Million, Led by Rwanda and Uganda

KENYA · BANKING

I&M Group made Sh10.2 billion (about US$79 million) after tax in the first half of 2026, a rise of 22 percent, and almost none of the additional profit came from Kenya. Rwanda and Uganda did the growing while the Kenyan bank held flat and set aside more against bad debt.

What the I&M Group results show

The lender published half-year figures at an investor briefing in Nairobi on Thursday 27 August. Profit after tax reached Sh10.2 billion (about US$79 million), up 22 percent, on total operating income of Sh33.7 billion (about US$261 million).

The profit attributable to shareholders, after minority investors in the subsidiaries take their cut, was Sh9.31 billion (about US$72 million), up 20 percent. Shilling figures in this article convert at about Sh129 to the US dollar.

The balance sheet grew faster than the profit. Total assets rose 27 percent to Sh746 billion (about US$5.8 billion), deposits 18 percent to Sh505 billion (about US$3.9 billion) and net loans 15 percent to Sh334 billion (about US$2.6 billion).

Asset quality improved on the headline measure. Gross non-performing loans fell 12 percent to Sh30.1 billion (about US$233 million) and the net ratio dropped to 2.3 percent from 4.1 percent.

Kenya is flat, and that is the story

Profit before tax — earnings before the taxman’s cut — in Kenya came in flat at Sh8.3 billion (about US$64 million). Every point of group growth was earned somewhere else.

Rwanda lifted pre-tax profit 53 percent to Sh2.4 billion (about US$19 million) and Uganda more than tripled its own to Sh700 million (about US$5.4 million), from a small base. Tanzania added 8 percent to Sh600 million (about US$4.7 million), while Bank One in Mauritius slipped 3 percent to Sh900 million (about US$7 million).

The group says non-Kenyan units now contribute 33 percent of pre-tax profit, up from 25 percent a year ago. Those named subsidiary figures add to Sh4.6 billion (about US$36 million) against Kenya’s Sh8.3 billion (about US$64 million), which is nearer 36 percent, so the published split is presumably struck after holding-company costs.

Better ratios, bigger provisions

The apparent contradiction in the numbers is worth pausing on. Non-performing loans fell, yet loan-loss provisions — money set aside for loans that may go bad — rose 38 percent to Sh5.6 billion (about US$43 million).

The increase is concentrated in Kenya, where provisions were up 34 percent at Sh4.2 billion (about US$33 million). The bank attributes this to domestic economic conditions and geopolitical uncertainty.

Provisioning ahead of losses is not a warning sign in itself. It usually means management is either cleaning up faster than the ratios suggest or expecting the environment to worsen.

The coverage question follows from that. A bank that lifts provisions while bad loans fall is building a larger cushion against a smaller problem, which is the conservative choice.

The regional bank thesis, tested

East African lenders have spent a decade arguing that the way past a saturated Kenyan market is to build in Rwanda, Uganda and Tanzania. These results are the clearest read on that argument in some time.

Rwanda is now the second-largest profit contributor in the group. Uganda more than tripled its contribution, although from a base small enough that the percentage flatters it.

Bank One in Mauritius is the outlier in the set. It slipped 3 percent to Sh900 million (about US$7 million), and Mauritius is a different business from the East African units, weighted towards offshore and structured finance.

The risk of the strategy is the same as its promise. Smaller markets grow faster and they turn faster, and a tripling of profit can reverse at the same speed.

What it means for anyone holding the shares

The stock, listed on the Nairobi Securities Exchange, Kenya’s main bourse, has already re-rated hard. It ended 2025 at Sh42.50 (about US$0.33) and traded near Sh80 (about US$0.62) when the results were presented, a gain approaching 90 percent this year.

Deposit growth is the number to keep an eye on. Deposits rose faster than loans, which usually means a bank is gathering funding ahead of the lending it expects to do.

Small business lending is the other engine. The group says revenue from that segment rose 41 percent, and digital and ecosystem business now accounts for 21.7 percent of retail and business banking income, up from 14 percent.

Kihara Maina, the regional chief executive, attributes the result to disciplined execution of the group’s diversification strategy. Chief financial officer David Ngata presented alongside him.

This is company reporting rather than investment advice, and half-year figures are unaudited. Anyone acting on them should read the published results in full.

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