Co-operative Bank headquarters in Nairobi. The bank has introduced a paperless end-to-end account opening process.
Co-operative Bank headquarters in Nairobi.

Listed tier 1 commercial lender Co-operative Bank has reported a 12% increase in profits after tax for the full year ended December 2019 on growth in non-interest income.

The Ksh14.3 billion full-year profit reflects an increase of Ksh1.5 billion from the Ksh12.7 billion the lender reported the previous year.

Co-operative’s balance sheet shows the lender’s earnings from investment in Kenyan government securities increased to Ksh40.9 billion from the Ksh30.5 billion reported the previous year.

By the same token, interest income from loans and advances stands at Ksh31,7 billion down from the Ksh32.9 billion reported at the close of 2018.

Net loans advanced to customers stood at Ksh266.7 billion at the end of December 2019 from the Ksh245.4 billion posted the previous year.

On the downside, the group’s Gross Non-Performing Loans (NPLs) jumped to Ksh31.6 billion, a 7.5% increase from the Ksh29.4 billion reported in 2018.

“The group has continued with a strategy for continued deepening and dominance in our domain market segment leveraging on our successful penetration of the micro, medium and small enterprises (MSMEs) and the Saccos while reviewing opportunities to grow alternative income streams,” said Co-op Bank Managing Director Gideon Muriuki.

The bank’s board has recommended a dividend of Ksh1 per ordinary share which will be paid to shareholders on June 5.

Jamii Bora

On March 11, the lender’s board voted to acquire 100% stake in Jamii Bora Bank, a micro-lender overlooked by CBA, before it merged with NIC to form NCBA.

Muriuki maintains that the decision to acquire the microlender is a strategic one although, CBA walked away from the negotiating table over concerns over the microlender’s negative liquidity position as espoused by the lender’s NPLs which stood at Ksh2.2 billion at the time CBA shelved the acquisition idea.

But all that has been downplayed at Co-operative with Muriuki maintaining that the acquisition of Jamii Bora will support future growth.

The microlender boasts of 350,000 customers and 17 branches across the country and an asset base of Ksh12.5 billion.

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