Cooperative Bank has posted an impressive Profit Before Tax (PBT) of Sh 18.2 Billion to cement is position in the top 3 most profitable banks in Kenya.
In 2017, the lender’s PBT stood at Sh16.4 billion, indicating a
growth of 11% despite a challenging operating environment in the period. Profit after Tax was Kshs12.7Billion compared to Kshs11.4 Billion in the previous year
Courtesy of the long-serving bank’s Managing director and CEO, Mr Gideon Muriuki, the bank is said to have developed a unique business model to cushion it against the vagaries of inflation and harsh business environments.
“The Group continues to leverage on the benefits of the “Soaring Eagle” Transformation Agenda that has re-tooled and equipped the business with added competitive edge as reflected in the sustained growth in market share across all market segments and Counties, which has progressively deepened our celebrated Financial Inclusion model rooted in the over 15 million-member co-operative movement, that is the face of Kenya,” said Mr Muriuki.
Sh 43 billion interest
Total interest income improved by 7% from Kshs 40.37 billion to Kshs 43.02 billion on account of; Interest income from government securities increasing by 19% from Kshs 8.21 billion to Kshs 9.79 billion and Interest income from loans & advances increasing by 3% from Kshs 31.94 billion to Kshs 32.95 billion.
Total interest expense remained under tight control, falling by Kshs 300 million from Kshs 12.27 billion to Kshs 12.24 billion. This was despite a 7% growth in deposits indicating improved management of the cost of funds.
Total operating income grew by 5% from Kshs 41.6 Billion to Kshs 43.68 Billion.
Balance sheet
Total assets grew by Kshs26.5 Billion (+7%) to Kshs413.41 Billion from Kshs386.86 Billion recorded at the close of year 2017.
Net loans and advances book declined marginally (-3%) to stand at Kshs. 245.41 billion compared to Kshs. 253.86 billion in 2017.
Investment in Government securities grew by Kshs11.03 Billion (+16%) to Kshs. 80.27 Billion compared to Kshs. 69.24 Billion in 2017.
Customers deposits grew by 7% from Kshs287.37 Billion to Kshs 306.12 Billion
Borrowed Funds from development partners grew by Kshs2.79 Billion (+13%) to Kshs 23.95 billion compared to Kshs.21.16 billion in 2017.
Shareholders’ funds grew to Kshs69.86 Billion in 2018 that enables the bank to continue to pitch for big-ticket deals.
Innovative Customer Delivery Platforms
Through their multi-channel strategy, the Bank has successfully moved 91% of all customer transactions to alternative delivery channels that include self-service kiosks in 155 branches, an expanded 24-hour contact centre, mobile banking, 580 ATMs, internet and over 11,000 Co-op Kwa Jirani banking agents.
A successful Universal Banking model and the implementation of Sales Force Effectiveness has seen the Group serve over 8 Million Account-holders across all sectors.
Key focus on digital banking, with the all-telco Mco-op Cash Mobile Wallet continuing to play a pivotal role in the growth of non-funded income with 4 Million customers registered.
Their unique model of retail banking services through Sacco FOSAs enabled them to provide wholesale financial services to over 464 FOSA outlets and issue over 1 Million Sacco-Link cards.
Regional Expansion
Co-operative Bank of South Sudan that is a unique Joint Venture (JV) partnership with Government of South Sudan (Co-op Bank 51% and GOSS 49%) made a Profit before tax of South Sudanese pounds (SSP) 897.3 Million in 2018 which was 368% higher than SSP 192 Million posted in 2017. This performance however translated to a monetary loss of Kshs. 16.4 million in 2018 attributable to hyperinflation accounting occasioned by currency devaluation of the South Sudanese pound.
Corporate Social Investment
Co-operative Bank Foundation has provided Scholarships for gifted but needy students from all regions of Kenya. The sponsorship includes; fully-paid secondary education, full fees for University education, Internships and career openings for beneficiaries. The Foundation is fully funded by the bank and has so far supported 7,002 students since inception.