Equity Group (EQTY) Q4 2025 earnings summary

Executive summary

• Achieved record profit after tax of KSh75.5 billion for FY2025, up 55% year-over-year, marking the highest in East and Central Africa, with strong contributions from regional subsidiaries and insurance operations.

• Balance sheet expanded 9% to KSh1.97 trillion/KES 2.2 trillion, with customer deposits up 4% to KSh1.46 trillion and net loans up 8% to KSh882.5 billion; regional subsidiaries now contribute about half of loans, assets, and banking profitability.

• Strategic focus shifted from defensive optimization to aggressive, value-creative growth, leveraging efficiency gains, digital transformation, and regional diversification.

• Over 98% of transactions conducted outside branches, with 88.4% via digital channels, reflecting significant investments in technology and digital transformation.

• Non-banking segments, especially insurance, are rapidly growing, with Equity Life Assurance issuing 19.2 million policies and serving 6.9 million customers.

Financial highlights

• Net interest income rose 17% to KSh126.9 billion, driven by a 24% reduction in interest expense; non-funded income up 7% to KSh90.8 billion, now comprising 42% of total revenue.

• Cost-to-income ratio improved to 51% from 58.2%, with operating expenses down 5% and discretionary costs down 10%.

• Loan loss provisions dropped 28%, with NPL coverage at 67.7% and cost of risk reduced to 1.7%.

• Dividend payout increased 35% to KSh21.7 billion (KSh5.75 per share), the highest in company history.

• Earnings per share increased 55% to KSh19.1; return on average equity at 26.7%, return on average assets at 4.2%.

Outlook and guidance

• Projected loan growth of 8%-12.5% and deposit growth of 8%-10% for 2026; NIM targeted at 8.3%-9.0%.

• Return on equity expected to remain 25%-30%, with return on assets at 4%.

• Cost-income ratio targeted to improve further to 46%-49%.

• 2030 strategy targets operations in 15 countries and 100 million customers, leveraging digital and AI-enabled capabilities.

• Subsidiaries expected to contribute 50–55% of assets and 45–50% of PBT.