Kenya’s Co-operative Bank shareholders have approved the lender’s proposal to increase its share capital to Ksh 7.5 billion ($75 million) from Ksh 5 billion ($50 million).
The nod sets stage for a bonus share issue of one share for every five held.
The bank’s owners also approved a dividend payout of Ksh0.8 ($0.008) per share.
“The future of the Group is promising, notwithstanding the tight operating environment especially with the capping of interest rates,” said Gideon Muriuki, the Group’s chief executive.
The bank’s stock on the Nairobi Securities Exchange (NSE) has increased by 24 per cent in less than two months after the lender announced plans to reward shareholders with dividends and bonus shares.
The lender’s share value increased from Ksh14 ($0.14) per share (April 18) to Ksh17.40 ($0.17) on May 26, 2017.
Analysts expect the bank to acquire market share from competition driven by their diverse exposure in corporate and retail banking segments.
The bonus issue will see the bank capitalise Ksh977 million ($9.77 million) from the deal.
The move will be preceded by an increase in the bank’s authorised share capital from five billion shares to 7.5 billion shares of Ksh1 ($0.01) each subject to shareholders approval.