Co-operative Bank Posts Sh3.6bn First Quarter 2019

As a result of higher loans income and non-funded income, Co-operative Bank of Kenya has posted a 4.4 percent rise in net profit for the first quarter ended March, amid lower operating costs.

The bank’s net earnings in the period under review totaled Sh3.59 billion as compared to Sh3.44 billion from the same period in 2018.

The interest income earned from government securities rose by 39.6 percent to Sh2.8 billion. This is as loans to the government saw a 38.6 percent increase to Sh103.9 billion during the quarter from Sh75 billion a year earlier.

Co-op Bank’s non-interest income jumped 19.1 percent to Sh4.2 billion, which also contributed to the improvement in performance.

Operating costs totaled Sh6 billion during the period, which is a decline of 1.2 percent.

Gideon Muriuki, the group CEO, cited enhanced efficiency, revenue diversification and prudent cost management strategy as the reasons for the bank’s performance.

“Key focus on digital banking, with the all-telco Mco-op Cash mobile wallet, continued to play a pivotal role in the growth of non-funded income with over 4.3 million customers registered and 1.2 million loans worth over Sh5.1 billion disbursed,” said Mr. Muriuki.

The lender notes that it has diversified 88 percent of all customer transactions to 155 self-service branches and 11,600 banking agents.

Co-operative Bank posted a pre-tax profit of Sh41.7 million in its joint venture with the South Sudan government in which it holds a 49 percent stake. This is a 28.7 percent increase from Sh32.4 million earned in a similar quarter last year.

The bank further said that the Micro Small and Medium Enterprise (MSME) loan packages launched in 2018 have seen an uptake of over 26,800 customers.

“We have earmarked Sh15.2 billion for MSME lending and to date, we have disbursed Sh3.2 billion under the program,” said Mr. Muriuki