Equity Group Profits Soar 32.2% to KES 54.12Bn in Q3-2025
Equity Group Holdings Plc reported a KES 65.58Bn profits before tax (PBT) for the third quarter of 2025 (Q3-2025), representing a 28.5% year on year (y-y) jump compared to KES 51.02Bn announced by end of September 2024. The performance was supported by higher interest income from loans, low cost of financing and a muted operating cost. This follows the ongoing interest rate cuts that resulted in improved credit scores and low cost of financing for the lender and its clientele on overall.
Profits after tax (PAT) accelerated up 32.2% y-y from KES 40.94Bn to KES 54.12Bn by end of Q3-2025 on a lower effective tax rate of 17.5% in relation to that of 19.8% recorded in Q3-2024. Quarter on quarter (Q-Q), Group’s PBT and PAT rose at a slower pace of 5.2% and 1.1%, respectively.
Equity Bank Kenya (EBK) recorded a fastest growth of 50.3% from KES 23.48Bn in PBT to KES 35.29Bn riding on its digital transformation of digital and operational efficiency. This saw EBK’s contribution total PBT balloon from 46.0% to 53.8% to reap from a rise in loan disbursements following the ongoing interest rate cuts that has seen credit somehow manageable to individuals and businesses. EBK PAT was up 51.2% to KES 31.09Bn. Subsidiaries’ PBT expanded 10.0% from KES 27.54Bn to KES 30.29Bn, out of which KES 28.70Bn came from the regional banking units led by Equity BCDC in the Democratic Republic of Congo which contributed KES 17.70Bn in PBT.
Overall, the Group’s earnings per share (EPS) expanded from 32.7% y-y from 10.41 to 13.81, annualized to 18.41 with a price to book ratio of 0.75x and a book value per share of 80.35. We issue a BUY recommendation on the counter’s share price with a revised value of KES 73.32 per share, a 13.9% upside from the current price of KES 63.50 per share as of 30th October 2025.
The Group’s Board of Directors did not issue any interim dividend.
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Income Statement
Equity Group’s net interest income (NII) jumped 16.1% y-y to KES 93.54Bn elevated by marginal rise on loans and advances interest income and a faster drop in total interest expense. Consequently, upticks in NII saw the NII contribution total income widen from 56.9% to 59.9%.
Total Interest income went up 2.9% y-y from KES 125.93Bn to KES 129.55Bn mainly on government securities income which went up 7.5% from KES 42.58Bn to KES 45.78Bn, while that of loans and advanced contracted 2.0% to KES 77.81Bn.
Quarter on quarter performance witnessed a 6.8% surge in interest income earned from KES 43.39Bn to KES 45.27Bn on impact from increased loan disbursements. The Bank’s focus shifted towards loans while going slow on government securities during the period to gain from the higher returns in the sector.
Total interest expense narrowed down 20.7% from KES 45.35Bn to KES 35.97Bn as the Bank passed on the rate cuts faster to its customers’ deposits. This was as the official base lending base rate dropped from 12.00% in Q3-2024 to 9.75% in Q3-2025. As such, cost on customer deposits dipped 14.7% y-y and 4.1% Q-Q as the rates cuts continued further.
Non-funded income (NFI) rose marginally at 2.5% y-y and 2.4% Q-Q to KES 62.69Bn, partly supported by other fees and commissions but held down by a static exchange rate. Kenya shilling stability against the US dollar saw forex trading income shrink 5.2% y-y from KES 9.24Bn to KES 8.76Bn.
Operating expenses were contained at KES 90.68Bn in Q3-2025 from KES 90.71Bn in Q3-2024 held down by 8.2% and 9.6% drops in loan loss provisions and other operating expenses to KES 11.64Bn and to KES 42.67Bn respectively.
Excluding loan loss provisions, operating expense went up 6.4% y-y and 1.3% Q-Q.
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Balance Sheet
The Group’s total assets rose by 6.7% y-y from KES 1.70trillion to KES 1.82Tr largely on additions from loans and advances and the government securities Book.
Government securities book attracted 13.9% year on year from KES 468.14Bn to KES 533.43Bn on impact higher rates just before the sustained rate cuts.
The Loan book advanced up 7.5% y-y and 4.2% Q-Q to KES 859.82Bn supported by improved credit scores and cost of financing following the above rate cuts.
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Key Ratios
Cost of funds declined from 4.2% to 3.3% supported by low cost of deposits and borrowings that financed the loan book. As a result, net interest margins (NIMs) enlarged from 6.9% in Q3-2024 ‘to 7.7% in Q3-2025.
The Group’s cost of risk shrunk 2.0% in Q3-2024 to 1.8% Q3-2025 supported by low loan loss provisions.
Return on average assets (ROA) rose 90.0bps from 3.1% in to 4.0% in Q3-2025 supported by the above rise in net revenues. Return on average equity (ROE) rose faster from KES 24.5% in Q3-2024 to 26.2% on a faster rise in net income compared to the total equity.
