Commercial banks have posted strong profitability in the first half of 2026 despite persistent foreign exchange shortages, high operating costs, subdued economic activity and declining interest rates.
Published unaudited financial reports for the country’s eight banks for the half-year period ended June 30, 2026 indicate a combined K524 billion profit.
An overview of the banks’ performance shows that the sector has remained resilient, with their profitability supported largely by growing customer deposits, improved loan performance and lower credit impairment charges.
Economist Marvin Banda said while the sector’s strong profitability in the first half of 2026 was welcome, it did not mean the wider economy had turned the corner.
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“The more important question is what is driving these profits. If profitability is being sustained largely by high interest rates and investment in government securities, then we should be more cautious,” Banda said.
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Standard Bank Malawi plc reported a profit-after-tax of K67.5 billion for the half-year, marking a 39 percent increase compared to K48.394 billion during the corresponding period in 2025
FDH Bank plc reported a consolidated profit-after-tax of K86.418 billion for the half year, representing a 43 percent increase compared to the previous year
First Capital Bank reported a consolidated profit-after-tax of K67.5 billion from K50.5 billion during the corresponding period, marking a 33.6 percent growth.
NBM recorded profit-after-tax at K133.97 billion, representing a 39 percent increase from K96.1 billion in the corresponding period in 2025.
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NBS Bank’s profit-after-tax rose 23 percent to K90.23 billion while CDH Investment Bank registered the fastest growth, with profit-after-tax more than doubling by 124 percent to K41 billion.
Ecobank Malawi reported a 30 percent increase in profit before tax to K31.7 billion, while Centenary Bank’s profit after tax rose to K5.6 billion from K3.1 billion.
CDH Investment Bank announced a post-tax-profit growth of 124 percent for the half year ended June 30, 2026 to K41 billion from K18.3 billion during the corresponding period last year.
Centenary Bank reported a profit-before-tax of K7.2 billion for the six months period ended June 30, 2026, representing 100 percent growth over the K3.6 billion reported in the corresponding period in June 2025.
The performance comes as the economy continues to face significant challenges, and a weak stock market performance, although inflation eased during the period under review, from 26 percent at the end of 2025 to 21.1 percent in June 2026.
The Reserve Bank of Malawi also cut its policy rate by 200 basis points to 24 percent in March while the lending reference rate declined to 20.40 percent by June.
Meanwhile, the financial institutions expect the operating environment to remain challenging during the second half of the year, with foreign exchange shortages, high fuel and import costs, unreliable electricity supply, weak domestic demand and adverse weather conditions among the key risks.
