Kenya Equities Market Update – 14 November 2025

Market Performance

During the week, the equities market was on a downward trajectory, extending profit-taking across key large-cap counters. The NSE 10, NSE 25, NASI, and NSE 20 declined by 3.2%, 2.9%, 2.4%, and 2.3%, respectively, taking the year-to-date (YTD) gains to 54.4%, 49.5%, 46.7%, and 46.1%, respectively.

The week’s decline was primarily driven by losses in key banking and consumer names such as Equity Group (-8.2%), KCB Group (-7.1%), and EABL (-4.2%), as investors engaged in mid-quarter portfolio realignment following strong earnings releases in prior weeks. However, Co-operative Bank (+8.3%) and DTB-K (+0.7%) offered some support, reflecting selective investor rotation within the financial sector.

Sector Performance – Banking Index

The Banking Sector Index declined by 3.2%, closing at 203.6, down from 210.3 the previous week. The pullback was largely attributed to losses in Equity Group (-8.2%), KCB Group (-7.1%), and ABSA (-3.3%), outweighing the positive performance from Co-operative Bank (+8.3%) and DTB-K (+0.7%).
Despite the week’s softness, the banking sector remains a key market driver, supported by strong capital adequacy, growing balance sheets, and easing monetary policy, which continue to underpin long-term sectoral resilience.

Market Activity & Foreign Flows

Market activity softened marginally, with equities turnover declining by 0.5% to USD 27.8 million, from USD 27.9 million the previous week. The YTD turnover now stands at USD 927.8 million.

Foreign investors remained net sellers for the sixth consecutive week, registering a net outflow of USD 3.0 million, down from USD 9.2 million the previous week. This brings the YTD net selling position to USD 81.8 million, reflecting continued cautious sentiment from offshore investors amid mixed global risk appetite.

Weekly Corporate Highlight

🏦 Co-operative Bank Kenya Q3’2025 Financial Results

Co-operative Bank released its Q3’2025 financial results, showcasing steady income growth despite a slight deterioration in asset quality.

Key Highlights:

• Earnings Growth: Core earnings per share rose 12.3% to Kshs 3.7, from Kshs 3.3 in Q3’2024. This was driven by a 13.9% growth in total operating income to Kshs 67.4bn, from Kshs 59.2bn, supported by higher interest income and expanded loan book.
• Cost Pressure: Total operating expenses increased 15.4% to Kshs 37.7bn, reflecting higher provisioning and administrative costs amid credit quality concerns.
• Asset Quality: The Gross NPL ratio rose to 17.3% from 16.5% in Q3’2024, as gross NPLs increased 12.7% to Kshs 78.9bn while gross loans expanded 7.8% to Kshs 456.8bn.
• Balance Sheet Growth: Total assets grew 8.6% to Kshs 815.3bn, driven by a 20.7% rise in government securities holdings and a 6.6% increase in net loans and advances to Kshs 406.5bn.

Insight:
Despite rising NPL ratios, Co-operative Bank’s performance underscores continued balance sheet expansion, revenue diversification, and strategic lending growth supported by a lower CBR environment. Its strong capital buffers and digital transformation initiatives remain key to sustaining profitability amid a competitive banking landscape.

Market Outlook

The equities market correction reflects a temporary pause in momentum after several weeks of robust gains. The underlying fundamentals remain sound — earnings momentum is positive, inflation remains contained, and the CBK’s accommodative stance supports domestic liquidity.
However, foreign investor caution and profit-taking in large caps may keep volatility elevated in the near term. Going forward, focus will shift to Q4 corporate earnings, dividend expectations, and global risk sentiment as key catalysts for direction.

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