Kenya’s banking sector remained resilient in 2025, recording growth in assets, deposits and lending while maintaining strong capital adequacy, liquidity and profitability.
According to the Kenya Bankers Association State of the Banking Industry Report, total banking sector assets increased by 10.3 percent to Sh8.35 trillion, reversing a 1.6 percent contraction recorded in the previous year.
Customer deposits also rose by 9.9 percent to Sh6.38 trillion, signalling continued public confidence in the sector. Tier One banks accounted for 75.4 percent of total industry deposits, while small banks recorded the fastest deposit growth at 22.3 percent.
Net loans and advances recovered by 6.9 percent to Sh4.35 trillion, while the sector’s stock of bad debt declined to 14.7 percent in 2025, from 16 percent in 2024.
Banks, however, increased loan-loss provisions by 16.5 percent to Sh97.87 billion, citing concerns over customers’ repayment capacity, limited access to collateral, poor credit scores, inadequate documentation and higher perceived lending risks.
