Kingdom Bank, a subsidiary of the Cooperative Bank of Kenya has posted a 42 per cent growth in net profit in the second quarter of 2022 to Sh421.7 million.
The Group’s SME niche lender bank almost doubled its net profit from Sh296.6 million reported last year.
The growth has been supported by a 37.5 per cent dip in total operating expenses to Sh1 billion.
The lower costs for the bank are supported by loan-loss write backs of Sh170.8 million in contrast with Sh391.7 million in loan-loss provisions last year.
The withdrawal of the loan default cover is anchored on a 10.4 per cent dip in gross-non-performing loans to Sh6 billion.
The lower operating costs have helped offset a 26.3 per cent decline in income for the bank to Sh1.4 billion.
Net interest income fell by 13.3 per cent to Sh1.3 billion from Sh1.5 billion as interest income eased from a 4.1 per cent loan book attrition in the period.
Non-interest funded income meanwhile fell sharply by 64.7 per cent to Sh138.7 million on shedding other income.
Kingdom Bank has seen its asset base grow marginally to Sh32.9 billion from Sh32.1 billion previously.
“The strong performance by the bank is in line with the Group’s strategic focus on sustainable growth, resilience, and agility,” Group managing director and CEO Gideon Muriuki said in a statement.
Other Group’s subsidiaries reported positive growth including the Co-operative Bank of South Sudan which returned to profitability after a three-year hiatus.
The Co-operative Bank of South Sudan run in partnership with the government of South Sudan returned a profit of Sh55.5 million compared to a loss of Sh290.1 million in a similar period a year ago.
The Group’s assets grew to Sh603.9 billion, from Sh573 billion with customer deposits growing to Sh423 billion.
Co-op Consultancy and Bancassurance Intermediary Ltd posted a gross profit of Sh593.3 million with Co-op Trust Investment Services contributing Sh85.7 million in profits.
Co-op Trust Investment Services on other hand contributed Sh85.7 million in profit before tax, with Funds Under Management of Sh196.4 billion, compared to Sh179.4 billion in June 2021.