Co-op Bank posts a net profit of Ksh.3.59 Billion in the first quarter

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The Co-operative Bank of Kenya (Co-op) has posted a net profit of Ksh. 3.59 Billion for the first quarter which ended in March. This is a 4.4 per cent rise in profitability as compared to the Ksh. 3.44 Billion which was posted in 2018.

During the period interest income from government securities jumped by 39.6 per cent to Ksh. 2.8 Billion. Also, the bank’s lending to the government increased by 38.6 per cent to Ksh. 103.9 Billion up from Ksh. 75 Billion the previous year. Non – interest income also by rose 19.1 per cent to Sh4.2 billion. This is in line with the trend where banks have been making profits lending to the government as opposed to its customers due to the risk-free nature of the business. It is also another reason why you will not see the rate cap going away anytime soon.

The lender’s total operating costs decreased by 1.2 percent to Sh6 billion in the period. This was reportedly down to prudent cost management strategy and enhanced efficiency.

In South Sudan, the bank’s joint venture with the government in which it owns 49 per cent stake made a before tax profit of Sh41.7 million, being 28.7 per cent higher than Sh32.4 million posted in a similar quarter last year.

The bank indicated that it had moved 88 per cent of all customer transactions to alternative delivery channels such as self-service kiosks in 155 branches and 11,600 banking agents.

Group CEO Gideon Muriuki, had this to say, “Key focus on digital banking, with the all-telco Mco-op Cash mobile wallet continued to play a pivotal role in the growth of non-funded income with over 4.3 million customers registered and 1.2 million loans worth over Sh5.1 billion disbursed.”

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