Kenya Weekly Equities Market Update | 27th March 2026

Market Performance

The Kenyan equities market recorded a sharp downturn during the week, with all major indices closing in negative territory. The NSE 10, NSE 25, NASI, and NSE 20 declined by 9.0%, 7.5%, 6.7%, and 6.6%, respectively, reflecting broad-based selling pressure across the market.

Despite the weekly decline, year-to-date performance remains positive, with gains of 8.8%, 5.6%, 4.3%, and 2.6% recorded for the NSE 20, NSE 25, NASI, and NSE 10, respectively. This indicates that while the market experienced a significant correction during the week, it continues to retain some resilience on a cumulative basis.

The downturn was largely driven by losses in large-cap banking stocks, with ABSA, KCB, and Co-operative Bank declining by 14.5%, 10.5%, and 9.8%, respectively. The sell-off was primarily attributed to heightened global risk aversion following escalating geopolitical tensions between Iran and the United States. These developments have raised concerns over potential disruptions in global oil supply, contributing to volatility in oil prices, inflationary pressures, and currency risks in oil-importing economies such as Kenya.

As a result, foreign investors adopted a risk-off approach, reducing exposure to frontier markets, including the Nairobi Securities Exchange, thereby amplifying the downward pressure on equities.

Sector Performance & Market Activity

The banking sector, which remains a key driver of market performance, was particularly affected during the week. The banking sector index declined by 8.0% to 221.9 from 241.3, largely mirroring the significant losses recorded by major banking stocks.

Market activity, however, picked up notably during the week. Equities turnover increased by 132.3% to USD 36.8 mn, up from USD 15.9 mn recorded in the previous week. This surge in trading activity suggests heightened investor repositioning amid the prevailing market volatility.

Foreign investor activity remained a key theme, with net selling persisting for the eighth consecutive week. Net foreign outflows stood at USD 3.9 mn, compared to USD 2.7 mn recorded the previous week, bringing the year-to-date net selling position to USD 66.0 mn. While this remains lower than the USD 92.9 mn recorded over a similar period in 2025, it continues to highlight sustained foreign investor caution toward the market.

Corporate Earnings Highlights

Diamond Trust Bank Kenya (DTB-K) – FY 2025 Results

Diamond Trust Bank Kenya reported a strong set of results for FY 2025, underpinned by robust income growth and improved asset quality. Core earnings per share increased by 23.1% to Kshs 33.7, supported by a 13.6% growth in total operating income to Kshs 46.7 bn, which outpaced the 9.4% rise in operating expenses.

Asset quality improved during the period, with the gross non-performing loan (NPL) ratio declining to 11.3% from 12.6%, reflecting stronger credit risk management as loan growth outpaced the increase in non-performing loans. The bank’s balance sheet expanded significantly, with total assets rising by 14.9% to Kshs 659.1 bn, driven by growth in both lending and government securities holdings.

The Board of Directors recommended a dividend of Kshs 9.0 per share, up from Kshs 7.0 in the previous year, translating to a dividend yield of 5.8% and a payout ratio of 26.7%.

I&M Group – FY 2025 Results

I&M Group also delivered strong financial performance, with core earnings per share rising by 21.2% to Kshs 10.8, driven by a 19.2% increase in total operating income, which outpaced the growth in operating expenses.

The bank recorded notable improvements in asset quality, with the gross NPL ratio declining to 9.6% from 11.5%, supported by a reduction in non-performing loans. The balance sheet expanded by 15.1% to Kshs 668.9 bn, largely driven by a significant increase in government securities holdings and steady growth in net loans.

The Board recommended a total dividend of Kshs 3.75 per share, representing an increase from Kshs 3.0 in FY 2024. This translates to a dividend yield of 7.5% and a payout ratio of 32.9%, reinforcing the bank’s strong earnings position and shareholder return profile.

NCBA Group – FY 2025 Results

NCBA Group reported moderate earnings growth, with core EPS increasing by 7.0% to Kshs 14.2. The performance was supported by a 17.0% increase in total operating income, although this was partially offset by a 21.0% rise in operating expenses, which weighed on overall profitability growth.

Asset quality improved, with the gross NPL ratio declining to 10.4% from 11.5%, supported by a reduction in non-performing loans alongside modest loan book expansion. Total assets grew by 7.5% to Kshs 716.0 bn, reflecting continued balance sheet expansion.

The Group declared a total dividend of Kshs 7.10 per share, representing a 29.1% increase from the previous year, with a dividend yield of 8.0% and a payout ratio of 50.0%, highlighting strong shareholder returns.

Kenya Reinsurance Corporation – FY 2025 Results

Kenya Reinsurance Corporation reported a weaker performance for FY 2025, with profit after tax declining by 12.9% to Kshs 3.9 bn. The decline was driven by a combination of reduced insurance revenue and increased expenses.

Insurance revenue fell by 11.1%, while insurance service expenses rose by 6.0%, alongside a sharp 91.0% increase in net expenses from reinsurance contracts held. This led to a significant contraction in the insurance service result, which declined by 96.3%.

Core earnings per share decreased by 27.2% to Kshs 0.6, while the dividend remained unchanged at Kshs 0.15 per share, resulting in a lower dividend yield of 4.6%. Despite the decline in profitability, the company’s balance sheet remained solid, with total assets increasing by 6.9% to Kshs 68.5 bn, supported by growth in other assets and government securities.

Overall Market Outlook

The equities market experienced a significant correction during the week, largely driven by external factors, particularly rising geopolitical tensions and the resulting shift in global investor sentiment. The sustained foreign outflows and sharp declines in banking stocks underscore the market’s sensitivity to global risk dynamics.

However, underlying corporate fundamentals—particularly within the banking sector—remain strong, as evidenced by robust earnings growth, improved asset quality, and attractive dividend payouts. This suggests that while short-term volatility may persist, the market continues to present selective opportunities for long-term investors.

Going forward, investor sentiment is likely to remain influenced by global macroeconomic developments, currency stability, and foreign investor flows, with local fundamentals providing a supportive base for medium- to long-term recovery.