CIC Insurance Group has made a Ksh 1.33 billion partial repayment on a multibillion shilling loan owed to Co-operative Bank of Kenya, using proceeds from a land sale to ease a debt burden that had weighed on the insurer’s finances for years.
The payment represents 27 percent of the outstanding loan, which stood at Ksh 4.92 billion at the close of 2025. The settlement cuts into a debt that has been restructured and rescheduled multiple times since it was first taken out in 2019.
CIC funded the repayment from the Ksh 1.8 billion it received in February from the partial sale of land in Kiambu and Kajiado counties. The Kiambu land had been used as collateral to secure the loan from Co-op Bank.
CIC sold 50 acres adjacent to Tatu City in Kiambu and 100 acres in Kajiado as part of a strategy to strengthen its balance sheet and reduce finance costs.
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Chief Executive Officer Patrick Nyaga said the bulk payment marked a significant milestone in the insurer’s debt reduction efforts.
“We will use the money to reduce the debt, which means our finance costs will come down significantly and the balance sheet structure will be improved,” Nyaga said. “We have been selling quarter blocks, so getting one buyer and making a bulk payment to the loan is a big breakthrough,” he added.
CIC spent Ksh 680.31 million on interest payments on the loan in 2025, and the partial repayment is expected to reduce that annual burden going forward.
The original loan, borrowed at a fixed interest rate of 12 percent with a five-year tenure, was due for repayment on October 15, 2024, but the deadline was extended after the insurer struggled to settle the principal. The loan was initially taken to retire a KSh 4.5 billion corporate bond.
Co-op Bank holds an effective stake of 24.82 percent in CIC through its 33.41 percent interest in Co-operative Insurance Society Limited, the insurer’s top shareholder. The dual relationship between the two institutions as lender and shareholder has made the debt arrangement unusual in the Kenyan market.
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The Insurance Regulatory Authority (IRA) discounts land holdings by 30 percent, preferring insurers to hold capital in liquid assets to ensure cash is available for settling claims. The land sales, therefore, serve both to reduce debt and to improve CIC’s regulatory capital position.
The impact of the land disposals is expected to be reflected in CIC’s financial results for the year ending December 2026.
By Benedict Aoya
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