Kenya Re Half-Year Profits Jump 50% to Sh1.5 Billion on Lower Forex Losses

Kenya Reinsurance Corporation (Kenya Re) has posted a strong rebound in earnings for the first half of 2025, with net profit climbing 50 percent to Sh1.5 billion, up from Sh1 billion a year earlier. The improvement was driven largely by a steep drop in foreign-exchange losses, which shrank to Sh22.2 million from Sh844.2 million, boosted by the shilling’s recent stability.

The state-owned reinsurer said the forex relief provided crucial support at a time when its core insurance business was under strain. Operating in more than 80 markets through hubs in Côte d’Ivoire, Zambia, and Uganda, Kenya Re also holds significant dollar-denominated assets such as Eurobonds, making its balance sheet highly sensitive to currency swings.

Even as bottom-line earnings improved, the reinsurer’s core insurance performance weakened. Insurance service results nearly halved to Sh302.9 million from Sh606.6 million, weighed down by soaring reinsurance costs that jumped to Sh598 million from Sh183 million last year.

Revenues and costs moved in opposite directions. Insurance revenue dipped to Sh6.3 billion from Sh7.4 billion, while service expenses eased to Sh5.4 billion from Sh6.6 billion. Commissions ceded to other insurers also declined. On the upside, operating and other expenses fell to Sh654.5 million from Sh964.7 million, softening the hit from weaker underwriting performance.

Looking ahead, Kenya Re is expected to focus on tighter expense management and diversifying revenue streams to reduce reliance on forex-sensitive assets. Its wide African footprint offers growth opportunities, particularly in underpenetrated insurance markets, though global reinsurance costs and currency volatility remain key risks.

The company’s second-half performance will determine whether it can sustain its forex-driven profit boost while strengthening its core business to deliver more stable earnings in the long term.