Just before the end of last year, Sidian Bank propelled itself into the ranks of mid-sized banks, even as it secured lucrative State deals and received a much-needed financing boost from its new owners.
Founded as a non-governmental organisation—K-Rep, short for the Kenya Rural Enterprise Programme—Sidian marked yet another milestone in its four-decade journey last year by becoming a Tier 2 bank, a classification by the Central Bank of Kenya (CBK) that denotes a market share of between one and five per cent.
Classification as a medium-sized lender means a bank has at least a one per cent market share based on five weighted parameters — assets, deposits, shareholder funds, number of deposit accounts and loan accounts.
A large bank, or Tier 1, has a market share of over five per cent, while a small bank has less than one per cent, according to CBK classifications.
The bank—renamed Sidian by the late billionaire Chris Kirubi after he acquired a majority stake from K-Rep’s institutional shareholders, including the African Development Bank, K-Rep Group, the World Bank Group’s International Finance Corporation and the Netherlands’ FMO—has seen its stars line up, with both customer deposits and shareholder funds increasing.
Sidian Bank’s rise has been helped by a combination of additional capital injection from its new shareholders and the clinching of new mega deals from lucrative government programmes and agencies.
For Sidian Bank, that fortune came through cash-rich accounts for public entities such as the Social Health Authority (SHA), the National Social Security Fund (NSSF), county governments and other public bodies.
In November, Nairobi Governor Johnson Sakaja, following a well-trodden path, directed public health facilities to transfer their accounts to Sidian Bank, giving the lender a significant shot in the arm in deposit mobilisation, even as its new owners pushed to elevate it into a mid-tier institution by 2028.
“Sidian had a cheaper interest rate and gave us a better offer. It is a good deal,” Mr Sakaja said while appearing before the Senate Committee on Devolution and Intergovernmental Relations.
“We invited many banks, and Sidian presented the best package. As for ownership, every bank has owners, but what matters is good service,” he told the committee when asked about the bank’s shareholding.
The new health-facility accounts translate into a steady inflow of deposits from hospital revenues, while also opening up additional lending opportunities should the facilities seek financing for emergencies or development projects. This could have boosted the bank’s ranking.
Earlier, in August 2024, it emerged that Sidian Bank was among six local lenders selected to handle payments under the Social Health Insurance Fund (SHIF), which is projected to handle close to Sh200 billion annually, according to official estimates.
In a line-up dominated by heavyweights—Tier 1 banks including KCB Bank Kenya, Co-operative Bank of Kenya, Absa Bank Kenya, Equity Bank and Diamond Trust Bank—Sidian stood out conspicuously as the only Tier 3 lender at the time, raising questions about how it edged out four other large banks and nine mid-sized competitors.
“We spoke to employers who told us where they prefer to make the payments from and ensured that the banks are first approved and licensed by CBK,” SHA chairperson Dr Abdi Mohamed said in a past interview.
Under the now-defunct National Hospital Insurance Fund (NHIF), payments were routed through KCB Bank Kenya, Co-operative Bank of Kenya, Equity Bank and National Bank of Kenya. Under the new SHA framework, however, the landscape appears to have shifted.
Reacting to public debate, Sidian clarified that its role involved facilitating collections.
“Sidian Bank only facilitates collections, remitting directly to SHA accounts. We do not hold or manage SHA funds,” the bank said.
In addition to SHIF contributions, Sidian Bank is also reported to have been authorised—alongside a handful of other institutions—to receive housing levy funds, the statutory 1.5 per cent salary deduction intended to finance affordable housing initiatives, as part of the government’s collection framework.
But perhaps Sidian Bank’s biggest catch has been the expanded NSSF, now in its fourth year of implementing higher mandatory contributions. Monthly deductions were raised from Sh200 to a maximum of Sh1,080 in 2022, before climbing further to Sh4,320 with further increments scheduled for this year.
By the end of 2024, the NSSF had placed about Sh800 million with Sidian Bank, making it the single largest beneficiary among the 11 lenders that shared Sh2.696 billion in fixed and term deposits from the provident fund, according to its annual report for the year ended December 2024.
Other beneficiaries during the year included Stanbic Bank Kenya with Sh650 million, Equity Bank (Sh553.7 million), Co-operative Bank of Kenya (Sh423.4 million), Imperial Bank (Sh206.1 million) and NCBA Bank Kenya (Sh63 million). Absa Bank Kenya, I&M Bank Kenya, National Bank of Kenya and KCB Bank Kenya — beneficiaries in the previous year — did not receive any placements in the period under review.
This marked a sharp reversal from 2023, when Co-operative Bank topped the list with Sh2.664 billion, followed by KCB (Sh1.94 billion) and NCBA (Sh1.35 billion). Other beneficiaries in a year that saw the NSSF place Sh10.63 billion in fixed and term deposits included Absa (Sh1.294 billion), National Bank of Kenya (Sh1.027 billion) and Equity Bank (Sh827 million).
In January 2023, Kirubi’s Centum Investments terminated a deal to sell its stake in Sidian to Nigeria’s Access Bank for Sh4.3 billion. Suddenly, it appeared as though the deal was off, and new buyers showed up.
This would have been the second acquisition in Kenya for Access Bank, which acquired Transnational Bank, now called Access Bank Kenya, in 2020. In the place of Access Bank, there were four new investment vehicles.
These are: Wizpro Enterprises Limited, Afram Limited, Pioneer General Insurance, Pioneer Life Investments and Telesec Africa. The new shareholders include Wizpro Enterprises with 1,610,332 shares, or a 24.9 per cent stake. Wizpro is fully owned by the former chairman of the Kenya Tea Development Agency Management Services, Mr Solomon Muriithi Maina, an ally of President William Ruto.
Mr Muriithi is also among the new six shareholders of HF Group with a combined ownership of 26.86 per cent spread between 4.1 per cent and 5.7 per cent stakes.
Following a rights issue—or sale of new shares to existing shareholders—by the mortgage lender, Mr Muriithi spent Sh326 million in 2024 to acquire an additional stake in the lender, pushing his ownership to 24.2 per cent from 18.27 per cent, according to filings at the Business Registration Service (BRS)—the State-owned firm that is the sole custodian of records for all companies.
Other new owners of HF Group are former Kenya Revenue Authority (KRA) chair Mr Anthony Mwaura, his spouse and daughter, who bought a Sh1.6 billion stake in the company, making the family the second-largest shareholder of the listed mortgage firm.
The Leader of Majority in the National Assembly, Mr Kimani Ichung’wah, who is also the Kikuyu MP and Thika Town MP, Ms Alice Ng’ang’a — who are Dr Ruto’s allies — also bought shares in HF Group.
The other shareholders of Sidian are; Afram Limited, Pioneer General Insurance, Telesac Africa and Pioneer Life Investments.
Consequently, the bank’s shareholding structure has shifted significantly over the capital-raising period, with Centum’s stake—held under Bakki Holdco Limited—diluted to 27.27 per cent from 40 per cent.
Predictably, the deals and the additional capital injection have begun to pay off, lifting both the lender’s market standing and its returns. Sidian Bank’s net profit surged 5.1 times in the nine months to September 30, 2025, largely driven by growth in non-interest income.
The bank posted a net profit of Sh1.47 billion, up sharply from Sh287.26 million in the corresponding period of 2024.
Customer deposits also rose significantly, with the lender channelling much of the fresh inflows into Treasury bills and bonds, bolstering earnings from risk-free government securities.
