Kenyan lender KCB Bank Kenya (KCB) and the African Development Bank (AfDB) have sealed a $150 million (KES 19.5 billion) financing deal to support green finance and accelerate climate-smart investments, while enhancing KCB’s trade finance capacity for the growing small business and corporate banking sectors in Kenya.
The financing package comprises a $100 million (KES 13 billion) subordinated debt facility set to bolster KCB Kenya’s Tier II capital. This support will strengthen the bank’s role as a key financial intermediary across priority sectors and help advance its goal of allocating 25% of its loan portfolio to green initiatives by 2031. A $50 million (KES 65 billion) transaction guarantee will enable AfDB to provide up to 100% to confirming banks against non-payment risks arising from the confirmation of letters of credit and similar credit finance instruments issued by the KCB.
“We are proud to partner with KCB as this is a testament to our shared commitment to advancing Africa’s green transition and ensuring that economic growth goes hand in hand with environmental stewardship,” said AfDB Director General for East Africa, Mr. Alex Mubiru.
Mr. Mubiru highlighted KCB’s strong leadership in sustainable finance and expressed confidence that the partnership will greatly impact climate positively and inclusive development for Kenya and the wider region.
On her part, KCB Bank Kenya Managing Director Annastacia Kimtai, noted that the bank is focused on supporting customers undertaking green projects.
“This partnership marks a significant milestone in our sustainability journey as it reinforces our commitment to scale up green lending and enable us to deepen our impact, catalyse private investment and support Kenya’s goal of achieving net-zero emissions by 2050,” she added.
The partnership is set to benefit small and medium-sized enterprises, women-led businesses, and climate-resilient projects, while broadening accessibility to long-term finance, creating jobs, and enhancing resilience to economic shocks. Additionally, the collaboration underscores AfDB’s role as a counter-cyclical financier and a trusted development partner.
KCB’s Green Initiatives
KCB green initiatives span renewable energy, infrastructure, and agriculture. The lender has played a key role in climate action, financial inclusion, and community development in line with its ambition to create long-term value for its stakeholders while supporting Kenya’s transition to a green and inclusive economy.
In 2024, the Tier-one lender’s green portfolio grew by 6.32% to 21.32%, mainly driven by a $402 million or KES 48.24 billion disbursement in green loans. The funds were channelled to green products fostering energy transition, including projects in the blue economy, e-mobility, and climate change adaptation.
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