Equity Bank Uganda set to close 2025 on firmer footing as clean-up phase gives way to growth

January 31, 2026 in Companies, Financial Services by Editor

Equity Group’s full-year results are expected to underline a decisive turnaround, as aggressive balance-sheet clean-up, falling non-performing loans and strong regional performance give way to renewed profitability and growth momentum across East and Central Africa.

After clawing back from a UGX 36.6 billion loss in 2023 to a UGX 13.1 billion pre-tax profit in 2024, Equity Bank’s Ugandan unit entered 2025 leaner, more disciplined, and structurally stronger. That turnaround—representing a 136pc swing in pre-tax performance—followed an aggressive balance-sheet reset that saw UGX 207.4 billion in non-performing loans written off and a further UGX 88.5 billion set aside in provisions.

While the scale of the write-downs underscored the exhaustion of regulatory tolerance for pandemic-era bad loans across the sector, they also marked the end of a painful but necessary clean-up. By early 2025, the lender appeared positioned to transition from repair to recovery.

Signals from the third quarter suggest that shift is already underway. In Uganda, Equity Bank posted a 61pc jump in profit after tax to Kshs 2.9 billion (about UGX 78.3 billion), up from Kshs 1.8 billion (UGX 48.6 billion) a year earlier. Investment securities expanded 23pcto Kshs 39.6 billion (UGX 1.07 trillion), while total equity rose by a similar margin to Kshs 18.5 billion (UGX 499.5 billion). Most tellingly, the non-performing loan ratio fell sharply from 20.9pc to 8.8pc, pointing to stronger credit discipline and recoveries.

That improvement comes after a deliberately cautious 2024. Net loan s fell 19pcfrom UGX 1,610 billion to UGX 1,309 billion, deposits dipped 6pcto UGX 2,802 billion, and total assets contracted 10pc to UGX 3,389 billion. The retrenchment weighed on topline growth but stabilised the franchise, allowing the bank to return to profitability.

During 2025, Equity Group’s decision to purge thousands of rogue employees further reinforced governance and reputational repair—an important signal for depositors after a year in which customer balances had softened. With confidence gradually returning, deposits are widely expected to rebound into the full-year close.

At group level, momentum has been more pronounced. Equity Group Holdings Plc reported a 32pc rise in profit after tax for Q3 2025 to Kshs 54.1 billion (UGX 1.46 trillion), driven by stronger regional subsidiaries, efficiency gains, and continued digital migration. Return on average equity stood at 26.4pc, while return on assets improved to 4.1pc. Net interest income grew 16pc, non-funded income rose 3pc, and the cost-to-income ratio eased to 50.6pc from 55.1pc.

Regional diversification continues to pay dividends. Subsidiaries now account for roughly half of group deposits, loans, and banking revenues, with Uganda, Rwanda, Tanzania, and the DRC all delivering double-digit growth in profitability and balance-sheet strength. Tanzania nearly doubled profit to Kshs 1.5 billion (UGX 40.5 billion), while the DRC posted a 21pc rise to Kshs 13.8 billion (UGX 372.6 billion). Equity Bank Kenya itself rebounded strongly, recording a 51pc jump in profit to Kshs 31.1 billion (UGX 839.7 billion).

Beyond banking, the insurance arm has added a fresh earnings leg, with Equity Insurance Group lifting gross written premiums by 71pc and profit before tax by 36pc, reinforcing the Group’s evolution into a fully integrated financial services platform.

Taken together, the third-quarter trajectory suggests that Equity Group’s full-year 2025 results are likely to reflect a clear pivot from balance-sheet repair to sustainable growth—with cleaner assets, improving returns, and regional operations increasingly anchoring earnings. For investors and regulators alike, the most significant takeaway may be that the worst of the post-pandemic hangover is now firmly in the rear-view mirror.