Family Bank Kenya plans to expand in East Africa, list on the Nairobi Securities Exchange (NSE) by next year and become a Tier 1 bank by 2029.

In Kenya, Tier 1 banks  hold a significant portion of the market share, have substantial financial resources, and are considered major players in the banking sector.

These are the top three goals in the bank’s five-year strategy, which seeks to drive shareholders' value by increasing tradability.

The bank’s chairperson, Lazarus Muema, exuded confidence that the goals would be met but remained tight-lipped on which countries they are targeting in the expansion drive. “We are doing our due diligence. There are immense growth opportunities within East Africa.’’

He is, however, confident that the lender will list on the Nairobi bourse by 2026, an ambition harboured by the founding director, Titus Muya, since 2023.

The lender first declared intentions to list at NSE in 2023, but the decision was halted following low trading activities that saw investors lose at least Sh530 billion in paper wealth on capital flight as the shilling slid against major currencies.

According to the Capital Markets Authority (CMA) quarterly statistical bulletin for the period ended December 31, 2023, the total market capitalisation at the Nairobi bourse closed at Sh1.43 trillion compared to Sh1.96 trillion same period in 2022.

The stock market achieved its highest-ever valuation of Sh2.94 trillion in August 2021.

"In our five-year strategic plan, we have put in an item for next year and this item is that we are going to list our share in the stock exchange and I know guys have been waiting for this,’’ Muema said.

He added that by listing, the bank aims at improving tradability of its shares as well as raising capital to boost the institution's liquidity, as well as finance its expansion into other untapped countries.

He revealed that they would rely heavily on investors' sentiment in determining the ticket size and the shares that the institution will be offering to other investors.

"The main reason for listing is to gain a degree of liquidity for our existing shareholders, you know there are two ways of listing, you can either go in to raise funds or you can go for an introductory listing where you float the existing shares to improve liquidity," Muema said.

This is good news for the NSE, which continues to suffer a listing dry spell for a decade now, despite increasing interest by both private and government entities.

In 2022, President William Ruto promised to ensure at least eight to 10 companies join the NSE by the following year in a bid to stimulate liquidity and allow shareholders to realise the value of their investments. The promise is yet to materialise, three years later.

"In the next 12 months, we will have between six and ten companies listed on the Stock Exchange. I promise we will deliver on that commitment," Ruto said.

Credit Bank also rescinded plans to list, citing low market activity.

Family Bank has posted impressive growth in the past five years. Established in 1984, the lender now commands at least 95 branches across 34 counties. 

In 2021, its corporate bond was oversubscribed, raising Sh4.42 billion. This was 147.3 per cent higher than the initial target of Sh3 billion. The funds were used for various purposes, including strengthening the bank's capital base and supporting its growth plans.

In its strategic plan running between 2025 to 2029, the bank intends to leverage technology for digitisation and data utilisation, increase productivity through efficiency, as well as come up with a compelling customer proposition.

This will see the bank spend over Sh1 billion in upgrading its core banking technology in the next 27 months.

"Most of the finance for our upgrade will come from our cash flow generated from our operations but we also have partners who are ready to support us especially on digital transformation so it will be a mix of internal resources as well as support of funds from impact partners," Family Bank Acting CFO, Paul Ngaragari said.

On Wednesday, the lender reported Sh1 billion in net earnings for the first three months of 2025, an increase from Sh900 million recorded in the first quarter of 2024.

In the period under review, the bank saw a 20 per cent jump in deposits to stand at Sh132.2 billion, a growth that enabled the bank to increase its lending by 10 percent, growing its loan book to Sh96.2 billion.