Kina Securities Limited reported a 20% increase in statutory net profit after tax to PGK 120.7 million for 2025, driven by strong revenue growth and loan book expansion. The bank declared a higher final dividend and anticipates continued earnings growth in 2026 amid favourable economic conditions and tax cuts.
- 20% increase in statutory net profit after tax to PGK 120.7 million
- 13% revenue growth supported by loan book expansion and foreign exchange income
- Final unfranked dividend raised to AUD 6.5 cents per share
- Improved net interest margin at 6.8% and cost to income ratio down to 54.7%
- Capital adequacy ratio remains strong at 17.1%, well above regulatory minimum
Robust Financial Performance in 2025
Kina Securities Limited (ASX: KSL) has delivered a solid financial performance for the year ended 31 December 2025, reporting a statutory net profit after tax (NPAT) of PGK 120.7 million. This represents a 20% increase compared to the previous year, underscoring the bank’s successful execution of its strategic plan focused on sustainable growth and diversification.
The company’s revenue rose 13% to PGK 545.5 million, driven by expansion in its commercial loan book, strong foreign exchange income, and growth in digital banking channels. Net interest income surged 20% to PGK 267.7 million, reflecting higher loan yields and increased lending activity across business and home loan portfolios.
Dividend and Shareholder Returns
In recognition of its strong earnings, Kina Securities declared a final unfranked dividend of AUD 6.5 cents per share, up from AUD 6.0 cents in the prior year. This brings the full-year dividend to AUD 11.0 cents per share, marking a 10% increase and signalling the board’s confidence in the bank’s ongoing profitability and cash flow generation.
The dividend is based on the NPAT attributable to equity holders and will be paid following the record date of 5 March 2026. The increase in dividends aligns with Kina’s commitment to delivering shareholder value while maintaining a prudent capital position.
Asset Quality and Risk Management
Asset quality remains stable with non-performing loans at 7.7%, a slight improvement from the previous year. Kina has enhanced its credit risk models in line with IFRS 9 standards, incorporating forward-looking macroeconomic scenarios to better anticipate potential credit losses. Loan impairment expenses rose to PGK 39.0 million, partly due to organic loan book growth and a one-off adjustment for aged non-performing loans.
The bank’s disciplined approach to credit risk is further reflected in its cautious stance on personal lending, where risk settings were tightened to improve portfolio quality. This focus on high-quality lending segments supports the bank’s resilience amid evolving economic conditions.
Capital Strength and Operational Efficiency
Kina Securities maintains a robust capital adequacy ratio of 17.1%, comfortably above the regulatory minimum of 12%. This strong capital base positions the bank well for future growth opportunities, including potential inorganic expansion and continued investment in digital capabilities.
Operating expenses increased modestly by 4%, with ongoing cost control measures helping to reduce the cost to income ratio to 54.7%. Investments in leadership, technology, and compliance enhancements, particularly in anti-money laundering and counter-terrorism financing, underpin the bank’s strategic priorities.
Outlook and Economic Context
Looking ahead to 2026, Kina Securities expects further earnings growth supported by Papua New Guinea’s projected 4% economic expansion. Key drivers include sustained commodity prices, particularly gold, and steady growth in non-resource sectors such as agriculture and retail.
The bank will also benefit from a reduction in the corporate tax rate from 40% to 35%, enhancing after-tax profitability. However, challenges remain, including increased competition in the foreign exchange market, currency depreciation pressures, and the country’s recent addition to the Financial Action Taskforce Grey List, which may impact regulatory scrutiny.
Overall, Kina Securities appears well-positioned to navigate these dynamics, leveraging its strong balance sheet, diversified revenue streams, and strategic focus on digital innovation and risk management.
Bottom Line?
Kina Securities’ 2025 results set a strong foundation, but investors will watch closely how it manages regulatory challenges and competitive pressures in 2026.
Questions in the middle?
- How will Kina Securities mitigate risks associated with Papua New Guinea’s FATF Grey Listing?
- What impact will the auditor’s review of capitalisation treatments have on reported profits?
- Can Kina sustain loan growth and asset quality amid increasing competition and currency volatility?