The East African Development Bank (EADB) closed 2025 with profit up 51%, a loan book that grew by more than half, non-performing loans below 1%, and two international rating agencies reaffirming its investment grade status.
The core lending business, the interest EADB earns on money it lends out, actually shrank in 2025. What pushed profit up instead was a jump in recoveries on old bad loans, lower impairment charges, and reduced staff costs.
At the same time, the regional lender’s capital cushion, the buffer that absorbs losses if borrowers default, nearly halved as loan growth outran the equity base backing it. And the Bank spent the year running its day-to-day affairs under an acting Director General Benard Mono, for the first time in almost two decades.
The Profit Numbers
EADB reported profit of USD 16.9 million for 2025, up from USD 11.2 million in 2024, a rise of 51%. Return on equity climbed to 4.63% from 3.21%, and return on assets rose to 3.25% from 2.21%.
Both remain modest by commercial banking standards, unsurprising for an institution whose mandate is development impact rather than shareholder returns.
What is less visible in the headline figure is where the extra USD 5.7 million came from. Interest income rose 6.9%, from USD 29.6 million to USD 31.6 million, as the loan book expanded. But interest expense rose faster, up 29.8% to USD 11.6 million, as EADB drew more heavily on borrowed funds to finance that lending.
The result: net interest income, the core spread between what the Bank earns on loans and what it pays on its own borrowings, actually fell by 3%, from USD 20.6 million to USD 20.0 million. A bank whose loan book grew 52% would ordinarily expect its lending income to grow with it. EADB’s did not, at least not yet. Much of the year’s disbursement growth came in the second half, so its full effect on interest income will only show up in 2026.
Instead, three other lines did the work of lifting profit. Net impairment charges on loans fell from USD 2.9 million to USD 0.8 million, a saving of USD 2.1 million. Other operating income nearly tripled, from USD 1.5 million to USD 4.6 million, driven almost entirely by a USD 3.1 million jump in recoveries of previously written-off loans, from USD 0.8 million to USD 4.0 million.
Uneven Regional Growth
EADB’s net loan book grew 51.6%, from USD 128.5 million to USD 194.8 million, and new loan approvals rose 37.7%, from USD 111.1 million to USD 152.9 million. Disbursements, the actual cash paid out against approved loans, more than doubled, up 139.7% to USD 91.6 million.
But that growth was sharply uneven across EADB’s four-member states. Rwanda’s disbursements grew 520% year on year, Uganda’s 97%, and Tanzania’s 83%. Kenya’s grew just 4%, the slowest of the four, and Kenya’s country office is currently without a substantive Country Manager, a gap the Bank says it is working to close.
Kenya’s loan book, at USD 8.3 million, is now a small fraction of Tanzania’s USD 101.0 million and Uganda’s USD 54.9 million, even though Kenya, Tanzania and Uganda each hold identical 23.30% shareholdings in the Bank.
But Kenya’s operations were the single most profitable of the four countries in 2025, posting USD 6.8 million in pre-tax profit, ahead of Tanzania’s USD 5.2 million. Yet Kenya’s accumulated deficit on the Bank’s internal segment books deepened over the year, from a negative USD 45.7 million to a negative USD 52.8 million.
Whatever the mechanics, the pattern is consistent: Kenya carries by far the largest accumulated segment deficit in the Bank’s books, alongside its smallest and slowest-growing loan portfolio. Tanzania, by contrast, is EADB’s most profitable and most heavily lent-to market, and the only segment with a positive retained-earnings balance of any size, at USD 44.5 million.
Asset quality across the whole portfolio remains strong. The non-performing loan ratio fell to 0.51% at the end of 2025, from 0.89% in 2024, and collateral coverage on the Bank’s small stock of Stage 3 (non-performing) loans stood at USD 5.2 million. For an institution that lent USD 152.9 million into some of the region’s higher-risk sectors, agriculture, SME finance and infrastructure, that is a low default rate, though it is also one built on a young, fast-growing book that has not yet been tested through a full credit cycle.
The governments of Kenya, Tanzania and Uganda each hold 23.30% of the Bank’s Class A shares, Rwanda holds 22.09%, and the African Development Bank holds 7.6% of the non-sovereign Class B shares, with a scattering of commercial banks, including Standard Chartered, NCBA Kenya and Nordea, holding the remainder. No dividend was paid for 2025
