Co-op Bank set aside Sh12.6billion SMEs loans to shore up businesses
The Co-operative Bank of Kenya (Co-op Bank) has set aside Sh12.6billion kitty targeting to offer affordable loans to Small and Medium Enterprises (SMEs) as the tier one commercial bank seeks to shore up struggling enterprises.
The Chief Executive Officer (CEO) Gideon Muriuki’s led bank unveiled the affordable loans and credit access at a time businesses are grappling to remain afloat from economic aftershocks coupled by rising inflation.
Muriuki said the bank has signed a Sh12.6 billion long-term credit agreement with global institutional investors led by the German fund, Deutsche Investitions–und Entwicklungsgesellschaft (DEG) to strengthen the bank’s capital base and support lending to small enterprises.
The facility was drawn in April 2023, the bank said.
“The strong performance by the bank is in line with the group’s strategic focus on sustainable growth, resilience and agility.” Muriuki sai in a statement.
The CEO made the announcement while releasing the 2023 first quarter results where the bank posted a 5.17 per cent jump in net earnings to Sh6.1billion.
The bank recorded a pre-tax profit of Sh8.15billion in the first three months of year 2023.
According to the bank, the jump in earnings was driven by growth in both interest and non-interest income, with total operating income rising 6.5 per cent to Sh17.9billion.
Non-interest-funded income grew at the fastest pace, increasing by 10.8 per cent to Sh7.1billion from Sh6.4billion in a similar period last year.
The lender’s net interest income grew by 3.9 per cent to Sh10.8billion from Sh10.4billion in 2022.
This came as total costs jumped by 8.8 per cent to Sh9.8billion, eating into the lender’s bottom line.
