HFCB Group H1 2026: 74% Profit Surge as Deposits and Revenue Growth Strengthen the Balance Sheet

HFCB Group has reported a strong first half of 2026, with Profit Before Tax rising 74% year-on-year to KSh1.22 billion, and after tax profits going up 59.9% to KSh 1.0 billion.

The performance was supported by broad-based growth across the Group’s income streams, alongside significant expansion in its balance sheet and customer deposit base. Total operating income increased 32% to KSh3.80 billion, while customer deposits grew by 31% to KSh68.97 billion.

The results point to a period of accelerated growth for HFCB, with the Group expanding its funding base while improving the cost of that funding and maintaining substantial capital and liquidity buffers.

 Revenue growth and a diversified earnings base

Net interest income increased 29% year-on-year to KSh2.64 billion, reflecting continued growth in the Group’s core financial services business. At the same time, non-funded income grew at a faster pace, increasing 37% to KSh1.16 billion.

The growth in non-funded income was supported by increased transaction volumes, fees and the continued diversification of revenue streams.

Together, the two income streams lifted total operating income by 32% to KSh3.80 billion.

The pace of revenue growth also outstripped the increase in operating costs. Expenses rose 18%, largely reflecting investment in human resources as the Group expanded its frontline workforce to support business growth.

This helped translate the stronger revenue performance into a much larger increase in profitability, with PAT rising by 59%, almost twice the rate of operating income growth.

The 37% growth in non-funded income suggests that transaction activity, fees and other revenue streams are becoming increasingly relevant to the Group’s earnings.

This provides HFCB with a broader earnings base at a time when traditional interest-driven banking income can be affected by changes in interest rates and lending margins.

The Group’s balance sheet expansion also gives it a larger platform from which to build these businesses. With total assets at KSh94.04 billion and customer deposits approaching KSh69 billion, HFCB is operating at a considerably larger scale than it was a year ago.

 A more efficient funding base

One of the strongest movements in HFCB’s first-half results was the growth of its customer deposits.

Deposits increased 31% to KSh68.97 billion, significantly ahead of the 22% growth in total assets. The expansion reflects continued growth in the Group’s customer funding franchise and provides a larger pool of funding to support future business expansion.

But the growth in deposits was accompanied by an improvement in funding efficiency.

HFCB reduced its cost of deposits by 68 basis points during the period. This means the Group was attracting more deposits at a lower cost.

The combination of faster deposit growth and a lower cost of deposits strengthens the quality of the Group’s funding base. It also provides greater flexibility as HFCB continues to expand its balance sheet.

Total assets increased 22% to KSh94.04 billion, a balance sheet steadily approaching the KSh100 billion mark.

HFCB’s growth has also been accompanied by a significant strengthening of its capital position; with its core capital standing at KSh10.5 billion at the end of H1 2026 while its core capital to risk-weighted assets ratio was 20.7%, almost twice the regulatory minimum of 10.5%.

The core capital has already exceeded the revised regulatory capital requirement that will apply in 2029.

The capital position is complemented by a strong liquidity buffer. HFCB’s liquidity ratio stood at 54.4%, compared with the regulatory minimum of 20%. Strong capital provides capacity to support a growing balance sheet, while high liquidity gives the Group greater resilience in managing its funding and cash-flow requirements.

 Growth accompanied by disciplined execution

Operating costs increased by 18%, considerably slower than the 32% growth in operating income. The increase was largely linked to investments in people, particularly the expansion of the frontline workforce.

HFCB Group CEO Robert Kibaara described the results as a reflection of disciplined execution, with growth across both funded and non-funded income while maintaining a focus on efficiency.

The numbers support that assessment. The Group expanded its asset base by more than a fifth, grew deposits by almost a third and increased operating income by nearly a third, while its profit before tax grew substantially faster.

The strongest takeaway is that HFCB is growing its earnings while building a larger and more efficiently funded balance sheet, broadening its revenue sources and strengthening the capital supporting its expansion.

With its core capital already ahead of the revised 2029 regulatory requirement, and its liquidity position providing additional resilience, HFCB heads into the second half of 2026 with a significantly stronger platform from which to pursue its next phase of growth.