The Co-operative Bank of Kenya Limited has registered an impressive a 4.7 per cent net profit growth in the first quarter ended March 2023 translating to a pre-tax profit of Sh8.15billion.
According to the leading commercial bank, the first quarter, the solid profitability in the first quarter of this year was achieved through higher interest income from affordable loans offered by the bank.
Effectively, the bank’s net earnings rose to Sh6.1billion during the period under review up from Sh5.8billion in the previous year.
Through a statement, bank’s Chief Executive Officer (CEO) Gideon Muriuki, this is a remarkable improvement from 59 per cent in FY2014 when the bank’s Growth & Efficiency journey began.
“The strong performance by the Bank is in line with the Group’s strategic focus on sustainable growth, resilience, and agility. The CEO noted.
Further, the lender’s total operating income grew by 6.5 per cent from Sh16.8billion to Sh17.9billion.
The Nairobi Securities Exchange-listed firm said the performance, which saw its return on shareholder funds stand at 22.2 percent, fits with its sustainable growth plan.
The firm’s total interest income rose 11.2 percent to Sh15.5billion, reflecting the impact of the loan book expanding by Sh35.6 billion to Sh360.1billion.
Co-op Bank reduced its investment in government debt securities by Sh4.1billion to Sh179.2 billion.
The NSE-listed lender made provisions of Sh1.5 billion which have enhanced the bank’s loan loss reserve levels to a high of 72 per cent from 69 per cent in 2021.
The good performance saw shareholders’ funds grow to Sh112.6 billion, a 9.7 per cent increase from Sh102.7 Billion in 2022.
So far, Co-op Bank, which has a network of 187 branches including four in neighbouring South Sudan as it seeks to bolster its expansion drive with three branches being the latest to be opened in Kenol in Murang’a County, Hindi in Lamu and Bamburi, Mombasa.
It had earlier opened five new branches in Kabarnet, Iten, Kasarani and Kamakis on the Eastern Bypass, Nairobi, last year.
Co-operative Bank of South Sudan which is a joint venture partnership with the government of South Sudan made a profit before tax of Sh110 million in the period.
This performance, however, translated to a monetary loss of Sh71.3million attributed by the bank to hyperinflation occasioned by the currency devaluation of the South Sudanese pound.
Co-op Trust Investment Services contributed Sh51.2 million in profit before tax with funds under management of Sh194 billion compared to Sh190.2 billion in the previous period.
“The Co-operative Bank Group continues to pursue strategic initiatives that focus on resilience and growth in the various economic sectors.” Muriuki added.
