HF Group Profit Surges on Heavy Government Lending Income
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HF Group is leaning more on government securities than traditional mortgages to drive profits. The shift has delivered strong earnings but raises questions about long-term lending strategy.
HF Group has reported a sharp rise in profit for the financial year ended 2025, driven largely by increased exposure to government securities rather than traditional mortgage lending in Kenya. The lender significantly expanded its holdings in Treasury bills and bonds, which boosted interest income and overall earnings performance.
The strategy led to stronger returns even as growth in the bank’s loan book remained relatively modest. Income from government debt instruments now represents a major pillar of HF’s profitability, reflecting a broader shift in how the institution deploys its deposits.
While the approach has improved short-term earnings and strengthened capital position, it also highlights a cautious lending stance in a high-risk credit environment. Analysts note that reliance on sovereign instruments could limit aggressive expansion in private-sector lending.
HF Group continues to position itself as a diversified financial services player, balancing mortgage lending, investments, and fee-based income as it navigates a changing banking landscape