Co-operative Bank of Kenya recorded a net profit of Sh18.4 billion in the nine months ended September, a 7.5 per cent increase from Sh17 billion in the same period last year.
The profit growth was driven by higher interest income from loans to customers and the government, as well as lower operating costs.
The bank’s total interest income rose by 12.8 per cent to Sh49.3 billion as it expanded its loan book by Sh42.9 billion to Sh378 billion and increased its investments in government securities by Sh16.2 billion to Sh138.6 billion.
“The strong performance by the bank is in line with the group’s strategic focus on sustainable growth, resilience, and agility,” said Gideon Muriuki, Co-operative Bank of Kenya managing director.
The bank’s deposit base grew by Sh835.7 million to Sh432.8 billion, while its interest expense increased by Sh4.8 billion to Sh16.5 billion, reflecting the impact of rising interest rates in the market.
Besides higher income from lending, Co-op Bank also benefited from lower operating costs. The bank’s total operating expenses decreased by Sh629.1 million to Sh29 billion, partly due to a reduction in loan loss provision by Sh1.5 billion to Sh4.2 billion.
The bank’s gross non-performing loans increased by Sh10.1 billion to Sh61.9 billion. Other operating costs also fell to Sh8.8 billion from Sh9.8 billion.
|Income Statement||Q3’2022||Q3’2023||y/y change|
|Net Interest Income||32.0||32.8||2.5%|
|Total Operating income||52.2||53.4||2.3%|
|Loan Loss Provision||(5.73)||(4.21)||(26.5%)|
|Total Operating expenses||(29.6)||(29.0)||(2.1%)|
|Profit before tax||22.7||24.7||8.6%|
|Profit after tax||17.1||18.4||7.6%|
|Earning per share||2.9||3.1||7.6%|
Co-operative Bank of Kenya subsidiaries’ performance
Kingdom Bank posted a net profit of Sh784 million—a 28.7 per cent growth from Sh609 million.
Co-op Consultancy & Bancassurance Intermediary Limited posted a pre-tax profit of Sh762.9 million. At the same time, the Co-operative Bank of South Sudan returned a pre-tax profit of Sh43.5 million after factoring in hyperinflation.
Co-op Trust Investment Services Limited contributed Sh154.5 million in pre-tax profit as the subsidiary’s funds under management closed the period at Sh196 billion.