Co-operative Bank Post 7.6% Growth in Half Year Results

Co-operative Bank of Kenya has recorded a profit before Tax of 9.98 billion shillings for the first half of 2018 compared to 9.3 billion shillings recorded in a similar period in 2017.

The 7.6 percent profit growth by Co-op has been witnessed against the backdrop of a challenging economic environment in the period.

Profit after tax for the lender stood at 7.1 billion shillings compared to 6.6 billion shillings in the previous year.

“This is a commendable performance in an operating environment that is gradually recovering from the significant headwinds that business had to contend with in the aftermath of the 2017 Elections,” said Co-op in a statement.

The bank attributed the performance to “the tangible benefits arising from the bold “Soaring Eagle” Transformation Project that the bank has been implementing since 2014 with a clear focus on improvement in operating efficiencies, Salesforce effectiveness and innovative customer delivery platforms.

During the period under review, total interest income improved by 7.9 percent from 19.25 billion shillings to 20.8 billion shillings.

Interest income from government securities increased by 17.45 percent from 3.87 billion shillings to 4.55 billion shillings.

Interest income from loans & advances increased by 5.7 percent from 15.26 billion shillings to 16.13 billion shillings.

Total interest expense increased marginally by 2.2 percent from 5.84 billion shillings to 5.97 billion shillings on account of a 4.5 percent growth of deposits.

Total operating income grew by 6.3 percent from 20.5 billion shillings to 21.8 billion shillings.

Total assets grew by 15.1 billion shillings (+3.9 percent) to 398.4 billion shillings compared to 383.3 billion shillings in the same period last year.

Net loans and advances book remained relatively stable at 251.1 billion shillings compared to 252.6 billion shillings in the same period last year.

Investment in Government securities grew by 9.7 billion shillings (+13.7 percent) to 80.2 billion shillings compared to 70.5 billion shillings in 2017.

Total deposits grew by 4.5 percent from 287.2 billion shillings to 300.2 billion shillings. Borrowed funds from development partners dropped by 5.9 billion shillings (24.3 percent) to 18.4 billion shillings compared to 24.3 billion shillings in the same period the previous year. This was as a result of an instalment payment to the debt provider.

Shareholders’ funds grew from 64.5 billion shillings to 68 billion shillings, an impressive growth of 5.5 percent supported by a steady growth in retained earnings.

The bank closed the quarter on a solid capital base, with adjusted total capital against total risk-weighted assets standing at 16.9 percent which is 2.4 percent above the statutory minimum of 14.5 percent.