Past empirical investigations on financial ethics have failed to provide an empirical analysis of the primary unethical banking practices prevalent in Kenya’s banking industry, or the perceptions of banking professionals on the type of concerns they believe might be influencing their resolution making. This study aimed at investigating the impact of ethical financial practices on the financial performance of small and medium banks in Kenya. The specific objectives of this research were to; analyse the effect of insider abuse and to investigate the effect of predatory lending on financial performance of small and medium sized commercial banks in Kenya.