I&M Bank rolls out unsecured loans of up to KES 3 Million

I&M Group PLC has opened 2026 with a profit after tax of KES 5.0 billion for the first three months of the year, up 19% from KES 4.2 billion in the same quarter of 2025. The Nairobi Securities Exchange-listed banking group also reported profit before tax of KES 6.4 billion, a smaller 9% increase.

That gap between the two figures is the first thing worth pausing on. When after-tax profit grows faster than before-tax profit, it usually means the group paid proportionately less tax this quarter than last, whether through a lower effective rate, tax credits, or the changing mix of income across its markets. It is not a red flag, but it does mean the headline 19% flatters the underlying operating performance slightly. The 9% before-tax figure is the cleaner measure of how the core business actually did.

Underneath that, the engine looks healthy. Total revenue rose 24% to KES 16.1 billion. Net interest income, which is the money a bank keeps from the gap between what it charges borrowers and what it pays depositors, grew 31% to KES 12 billion. Non-interest income, covering fees, commissions, foreign exchange and insurance, rose a more modest 7% to KES 3.8 billion.

Deposits Outran Loans, and That’s Deliberate

The balance sheet tells the most revealing story. Total assets climbed 31% to KES 743 billion. Customer deposits jumped 26% to KES 512 billion. But the loan book grew only 10%, to KES 323 billion.

A bank taking in deposits far faster than it lends them out is a pattern we saw clearly in I&M’s full-year 2025 results, and the reason sits with the Central Bank of Kenya. The CBK spent more than a year cutting its benchmark rate, from a high of 13% in mid-2024 down to 8.75%, before pausing that easing cycle in April 2026 over rising global oil prices. In a falling-rate environment, lending margins compress, so banks become choosier about who they extend credit to. Parking money in government securities instead of chasing risky loans is the cautious play, and I&M is clearly making it.

The pay-off from that caution shows in asset quality. Net non-performing loans, meaning bad loans after the bank sets aside money to cover expected losses, fell 33% year-on-year to KES 8.4 billion. Gross NPLs eased from KES 34 billion to KES 32 billion. At the same time, the group raised its loan-loss provisions by 63%, building a thicker cushion against future defaults. Fewer bad loans and bigger buffers at the same time is the combination regulators like to see.

The 42% That Stands Out

The single most striking operational number is customer growth: the group added 42% more customers than a year earlier. For a Tier 1 bank with an already large base, that is a steep climb in twelve months, and it points to aggressive acquisition rather than slow organic drift.

That growth has a cost attached. Operating expenses rose 28%, which the group ties to opening branches, hiring and training staff, and brand spending. I&M Bank Kenya alone has added 12 branches since the first quarter of 2025 under its “Mahali Uko, Tuko” campaign. Spending ahead of revenue is the mark of a bank investing for scale, but it is worth watching whether those new customers and branches start generating returns that justify the outlay.

Kenya Anchors, the Region Adds Spice

I&M Bank Kenya, the largest unit, grew profit after tax 16% to KES 3.3 billion. Its gross NPL ratio held steady at 12.7%, and deposits grew 25%.

The regional subsidiaries together contributed 31% of group profit before tax, a meaningful slice. Uganda was the standout, with profit before tax up 169% to KES 304 million as its asset base swelled from UGX 1.1 trillion to UGX 1.6 trillion. Tanzania rose 45% to KES 469 million on trade finance, and Rwanda gained 14% to KES 850 million. The one soft spot was Bank One in Mauritius, the joint venture with CIEL Group, where profit before tax slipped 6% to KES 444 million even as its assets grew 14%.

The Non-Banking Businesses Are Growing Up

Two smaller units are worth flagging. Bancassurance revenue grew 33%, driven by a 148% surge in underwritten premiums to KES 3.5 billion. Wealth management revenue grew 209% to KES 229 million. These are still small numbers against a KES 16 billion revenue base, but the direction matters. When fee-based businesses like insurance and wealth management grow fast, a bank becomes less dependent on the lending cycle, which is exactly the kind of diversification that helps in a low-rate year.

The group also signed two notable partnerships in the quarter: one with B Lab Africa to support SMEs, and a deal with Sweden’s development agency SIDA to unlock a USD 30 million green lending portfolio for climate-aligned projects in Kenya.

What to Watch

I&M enters the rest of 2026 with strong deposit growth, falling bad loans and a regional footprint that is genuinely contributing. The questions for the next three quarters are straightforward. Can the loan book grow faster without that easy deposit-to-loan gap doing the heavy lifting? Will the 42% customer surge translate into revenue rather than just cost? And can the wealth and insurance arms keep up their pace? For now, the bank has bought itself room with a conservative balance sheet. The job ahead is turning that caution into lending income once rates settle.