KENYA – The Co-operative Bank Group half year to June net profits jumped 55.4 percent to KSh11.5 billion (US$95.87m) on strong growth in customer lending and payment charges.
The jump from KSh7.4 billion (US$61.69m) in a similar period last year was propped by an 11.8 percent growth in net interest income from KSh18.8 billion (US$156.73m) to KSh21.1 billion (US$175.91m).
The bank’s loan portfolio grew from KSh29 billion (US$241.77m) to KSh330 billion (US$2.75m) as the bank slowed down on government lending in favour of the private sector.
Investment in Government securities rose marginally to KSh183.2 billion (US$1.53m), compared to KSh182 billion (US$1.52m) in 2021.
Co-op Bank Group also saw strong growth in non-interest income, which jumped 29 percent to KSh13.3 billion (US$110.88m).
The Group CEO Gideon Muriuki said the lender has disbursed billions in small business loans as Co-op works with SMEs to ensure the bank maintains borrowers.
“Over 162,000 customers have taken up the MSME packages that we rolled out in 2018, and 26,943 have been trained on business management skills,” Mr Muriuki said.
“Year to date, we have disbursed KSh12.6 billion (US$105.04m) to MSMEs through our Mobile E-Credit solution. MSMEs are a critical part of economic recovery post-covid and contribute up to 16 percent of our total loan book.”
Banks have opened their purse to the private sector recording double-digit growth for the first time in the first quarter of 2022 for close to five years.
Co-op says they have ensured that they maintain loan book quality even as the lender ups loans to the private sector.
The lender has also leveraged development partners for cheap credit for on-lending with external funds from development partners standing at KSh41.4 billion (US$345.14m).
The Group’s SME niche lender Kingdom Bank also recorded impressive growth booking a 48 percent pretax profit of KSh405.9 million (US$3.38m) in the second quarter of 2022 compared to KSh275 million (US$2.29m) reported last year.
Other subsidiaries including Co-op Consultancy and Bancassurance Intermediary Ltd posted a gross profit of KSh593.3 million (US$4.95m) with Co-op Trust Investment Services contributing KSh85.7 million (US$0.71m) in profits.
The Co-operative Bank of South Sudan run in partnership with the government of South Sudan returned a profit of KSh55.5 million (US$0.46m) compared to a loss of KSh290.1 million (US$2.42m) in a similar period a year ago.
The Group’s assets grew to KSh603.9 billion (US$5.03bn), from KSh573 billion (US$4.78bn) with customer deposits growing to KSh423 billion (US$3.53bn).
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