Macro Analysis /
Kenya

Kenya banks: Lucrative SME potential undercut by low yields and asset quality

  • SMEs account for 20% of the total loan book but growth is dependent on banks embracing new lending products

  • Equity Group has the largest SME loan book but margin suppression derails income: Q2 21 NIM at 6.6% vs. 11.8% in Q2 16

  • SMEs contribute 12% of total banking income but low loan yields and poor asset quality hinder growth prospects

Kenya banks: Lucrative SME potential undercut by low yields and asset quality
Faith Mwangi
Faith Mwangi

Equity Research Analyst, Financials (East Africa)

Tellimer Research
18 November 2021
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