KCB Bank Under Fire: Record Profits, No Dividends, and a CEO Pocketing Millions
Kenya’s banking sector is once again in the spotlight.
At the centre of growing outrage is KCB Bank—Kenya’s biggest bank by assets—which posted a jaw-dropping KSh 37.46 billion net profit for 2023 but failed to declare any dividends for its shareholders.
The decision has sparked public anger and investor frustration. Many are now asking:
- How does a bank make tens of billions and give nothing back to its shareholders?
Who is really benefitting from these profits?
The explanation from KCB is simple on paper. The bank cited “capital preservation” as the reason for not issuing dividends. It said the current economic environment and growing provisions for bad loans made it necessary to hold on to cash.
But many see this as an excuse, not a reason.
What stings more is the bank’s internal spending. While investors were told to tighten their belts, CEO Paul Russo walked away with KSh 177.6 million in total annual pay. That translates to KSh 14.8 million per month, or about KSh 487,000 per day.
Is this the reward for steering a profit-making bank that gives nothing to its investors?
Let’s compare this with other banks in the same economic climate:
Equity Group Holdings made a profit of KSh 41.98 billion and still paid out KSh 15.1 billion in dividends. Their CEO, James Mwangi, earned KSh 158.8 million—less than Russo—despite leading a more profitable bank.
Standard Chartered Bank Kenya declared a massive KSh 29 per share dividend, representing a 79% payout ratio. CEO Kariuki Ngare earned KSh 121.5 million, one of the lowest among top executives.
Diamond Trust Bank earned KSh 6.8 billion, a much smaller profit than KCB, yet declared a KSh 6 per share dividend. This amounted to KSh 1.68 billion—a 24.7% payout ratio.
So why is KCB—the biggest and one of the most profitable—doing the least for shareholders?
KCB’s decision has drawn more than just side-eyes. Investors are now pushing for accountability. Shareholder forums and online communities are abuzz with questions:
- Who approved this compensation plan?
- Why is executive pay rising while shareholder returns drop?
- Is the board doing enough to protect the interests of investors?
Even employees within the financial sector are talking. One bank insider said the decision has created tensions at shareholder briefings and internal meetings.
The backlash isn’t just about money. It’s about fairness.
Shareholders feel betrayed. They trusted the bank with their capital. They stayed loyal through tough economic periods. Now, when profits soar, they are told to wait—while the CEO’s income skyrockets.
This is not just a one-time issue.
There is growing concern that some top banks in Kenya are becoming fiefdoms for executives, where a few benefit massively while the majority—shareholders and ordinary customers—get little or nothing in return.
Regulators and watchdogs are being urged to act.
- Should the Central Bank of Kenya require public disclosure of dividend policies?
- Should there be a cap or approval process for executive pay in publicly listed banks?
These questions are now part of the national conversation.
For years, KCB enjoyed a reputation for stability and growth. But this episode could change how investors view the bank.
Some analysts say the bank’s silence over shareholder concerns is making things worse. Shareholders are not asking for the moon—they just want fair treatment and returns that match the bank’s performance.
If the bank is truly in trouble, shareholders deserve to know.
If it’s not, then why the silence?
KCB’s story is now a case study in how not to handle investor expectations. While other banks reward their shareholders, KCB has chosen to reward only its top executives.
As Kenya’s economy faces rising inflation, job losses, and cost-of-living struggles, the image of a CEO taking home KSh 487,000 a day while shareholders get zero is one that will be hard to shake.
KCB must decide what kind of bank it wants to be:
One that stands with its investors—or one that puts its bosses first.
