Green Lending Partnership: AfDB and KCB Ink $150m Deal to Boost Climate-Smart Financing in Kenya

The African Development Bank Group and KCB Bank Kenya today inked a $150-million financing package to fast-track green finance and further enhance KCB’s green finance capacity for climate-smart investments. This new green lending partnership is expected to increase trade finance and widen funding for sustainable projects of small businesses and corporates in Kenya.

The deal also involves a $100 million subordinated debt, which will enhance KCB’s Tier II capital and its goal of dedicating 25 percent of its portfolio to green projects by 2031. These projects include renewable energy, climate-resilient agriculture, and green infrastructure.

The package also includes a $50 million trade guarantee that would allow AfDB to provide up to 100 percent coverage to confirming banks against non-payment risks on letters of credit issued by KCB.

Green Lending Partnership Poised to Drive Climate-Smart Growth

Speaking during the signing, Alex Mubiru, AfDB Director General for East Africa, said the green lending partnership reflects a shared commitment to ensure that economic growth is aligned with environmental responsibility.

“We are proud to partner with KCB as this facility 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 Alex Mubiru, African Development Bank Director General for East Africa. “KCB has demonstrated strong leadership in sustainable finance, and we are confident this collaboration will deliver measurable climate impact and inclusive development for Kenya and the region.”

The partnership is expected to result in concrete dividends for small and medium enterprises, women-led ventures, and climate-resilient projects through better access to long-term financing, job creation, and increased resilience to economic shocks.

This follows an extensive due-diligence process and further solidifies AfDB’s evolving role in promoting counter-cyclical and development-focused financing across Africa.

KCB said it remains on course to scale up climate action and financial inclusion in its long-term sustainability strategy. The green lending partnership announced today, according to Managing Director Annastacia Kimtai, is a major step towards this goal.

“We are looking to strengthen our capacity in supporting customers focusing on green projects,” KCB Bank Kenya Managing Director, Annastacia Kimtai noted. “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.”

Last year, KCB disbursed $402 million in green loans, growing its green portfolio to 21.32% from 15% in 2023. The support was extended to green products designed to foster energy transition, including initiatives in the blue economy, e-mobility, and climate change adaptation.

As the green lending partnership takes shape, both institutions say it will play a catalytic role in accelerating Kenya’s transition toward a greener, more sustainable, and inclusive economy.

As the green lending partnership takes shape, both institutions say it will play a catalytic role in accelerating Kenya’s transition toward a greener, more sustainable, and inclusive economy.

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