CIC Insurance has paid Sh1.33billion to Co-operative Bank of Kenya as partial settlement of a multibillion-shillings loan extended to it by the lender, lowering its annual debt service burden. The paid amount was the proceeds of a land sale deal by CIC Insurance.
The insurer, which closed 2025 owing Co-op Sh4.92 billion, says it paid the Co-op Bank the Sh1.33 billion from the Sh1.8 billion it received in February this year from the partial sale of land in Kiambu and Kajiado. Co-op Bank owns a 24.82 percent stake in the insurer.
‘Subsequent to year-end, the group completed the sale of a portion of the secured land, and applied proceeds of approximately Sh1.33 billion towards repayment of the loan,’ said the insurer in the latest annual report.
The payment has cut the outstanding loan amount from the Sh4.92 billion it reported in its books at the end of December 2025. The reduction looks set to cut its loan servicing burden from the current over Sh500 million per year.
CIC spent Sh680.31 million on interest payments on the loan in 2025 and now eyes a reduced annual burden of debt servicing with the partial payment. The Sh1.33 billion repayments are equivalent to 27 percent of the outstanding loan, whose payment has been rescheduled several times.
CIC tapped the Co-op loan using the Kiambu land as collateral. The borrowing was at a fixed interest rate of 12 percent with a tenure of five years and was due for repayment on October 15, 2024. However, the repayment was pushed forward.
The loan was structured as a single draw-down with a bullet repayment of the principal sum at the end of the tenure, and also attracts interest repayment thrice a year.
CIC tapped the loan for repaying a Sh4.5 billion corporate bond. The loan is secured by 200 acres of land in Kiambu, which the insurer valued at Sh4.99 billion in its books at the end of December last year.
The insurer said it closed last year with deposits amounting to Sh719 million, which it received from potential buyers. CIC explained that the amount is held as payables until the revenue recognition criteria are met.
CIC had lagged on Co-op loan repayments, closing last year with principal instalments relating to two quarters.
‘The loan, therefore, had repayment delays on principal, although interest obligations were fully serviced during the year,’ said the insurer.
In 2024, CIC received an extension from Co-op Bank to reschedule the loan repayments by a month. The company received another extension to reschedule repayments by a further two months to mid-January 2025 after missing the initial timeline.
The two extension periods were to allow the parties to agree on the new restructuring terms for the loan repayment, as the sale of the Kiambu land was delayed.
CIC launched the process of selling the Kiambu land in November 2022. Delays in the process forced it to reschedule the loan.