Co-op Bank half year net profit hits $75m

Friday August 23 2019

Co-operative Bank group managing director

Co-operative Bank group managing director Gideon Muriuki. The lender’s net profit for the first half of 2019 grew to $75 million. PHOTO | DIANA NGILA | NMG 

BUSINESS DAILY
By BUSINESS DAILY
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Co-operative Bank’s net profit for the first six months of 2019 has grown 4.6 per cent to Ksh7.5 billion ($75 million), majorly supported by growth in non-interest income.

Total non-interest income, mainly from fees and commissions on loans and advances, increased by 25 per cent from Ksh7 billion ($70 million) to Ksh8.8 billion ($ 88 million) while interest income grew marginally to Ksh20.45 billion ($204.5 million) from Ksh20.2 billion ($202 million)

Group Managing Director Gideon Muriuki said prudent cost management strategy and revenue diversification helped to deliver the growth in profitability.

“The group has continued with a strategy for continued deepening and dominance in our domain market segment while reviewing opportunities to grow alternative revenues from other services like bancassurance, and leasing business,” said Mr Muriuki.

The strong growth in non-funded income helped to grow the top line despite the sluggish growth in total interest income.

Its all-telco Mco-op Cash mobile wallet was a key driver in growing non-funded income by disbursing loans worth Ksh14.4 ($144 million) billion as at the close of half-year under review.

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The wallet has more than 4.6 million registered customers.

Its South Sudan joint venture in which it owns 49 per cent stake made a before-tax profit of Ksh93 million ($930,000), which was a 19 per cent drop compared to Ksh115 million ($1.15 million) posted in the half-year of 2018.

The results helped Coop to remain the third most profitable lender after Equity and KCB Group which posted Ksh11.92 billion ($119.2 million) and Ksh12.7 billion ($127 million) net profit respectively during the period.

NIC Bank , which is working on a merger with Commercial Bank of Africa, with the hope of outpacing Coop on bottom-line, saw a 4.2 per cent drop in profit to Ksh1.9 billion ($19 million).

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