Banks Report Profit Despite South Sudan Inflation

(JUBA) – The resumption of crude oil trade in South Sudan has helped regional banks achieve strong profits despite global economic pressure caused by the conflict in the Middle East.

Financial institutions including KCB, Equity, Co-operative, I&M, and DTB reported significant growth in 2025. This performance was supported by South Sudan’s return to the oil market, which provided a boost to the economy even as the country faced high inflation.

Regional branches of these banks are now looking to infrastructure projects across East Africa to maintain their earnings. Lenders are moving away from a total reliance on interest from loans by growing other parts of their business such as insurance and digital payments.

Experts note that while some profits were affected by the varying value of the Kenya Shilling against other currencies, the overall expansion into neighbouring markets has protected banks from risks in any single country.

Economic activity across the region faces new challenges as the war between the United States, Israel, and Iran enters its second month.

The closure of the Strait of Hormuz has stopped nearly all oil tanker traffic, which is expected to push global oil prices to an average of $113 per barrel. There are concerns that these rising energy costs will lead to higher prices for basic goods in South Sudan and Kenya.

In Kenya, the banking industry is preparing to lend an additional 326 billion Shillings to businesses as interest rates begin to fall. This amount is roughly equivalent to 1,858,200,000,000 South Sudanese Pounds (1.8 trillion SSP) or $326,000,000.

However, the Kenya Bankers Association warned that the Middle East crisis could slow down this recovery if investors decide to wait for the conflict to end before starting new projects.

The ongoing airstrikes and naval blockades in the Gulf have also disrupted trade routes to Asia. Reports indicate that Kenya could lose over $1 billion in export earnings, while the cost of imports like fuel and industrial materials could rise by more than $3.5 billion.

If the tensions continue, banks may focus on saving their capital rather than issuing new loans throughout 2026 to protect themselves from a potential increase in unpaid debts.