- The low cost-to-income ratio is a remarkable improvement from 59 per cent in FY2014 when the bank’s growth and efficiency journey began.
- The good performance saw shareholders’ funds grow to S 112.6 billion, a 9.7 per cent increase from Sh102.7 Billion in 2022.
A sustained push by the Cooperative Bank for greater efficiency in its operations enabled tier one bank to attain a historic cost-to-income ratio of 43.6 per cent to register solid profitability in the first quarter of this year.
This is a remarkable improvement from 59 per cent in FY2014 when the bank’s Growth & Efficiency journey began.
The bank also continued to build a sound capital war chest by plowing back part of its earrings which further boosted the shareholders' funds to another historic high of Sh 112.6 billion, a 9.7 per cent rise from Sh 102.7 billion as at the close of last year.
The bank's financial statement for the first three months of 2021 shows that deposits grew to Sh419.8 billion compared to Sh410.8 billion same period last year.
The high liquidity saw the lender record a net profit of Sh6.1 billion in the first three months of the year as both interest and non-interest incomes rose.
This is an increase of 5.2 per cent compared to Sh5.8 in profit after tax that the lender that supports over 15 million Sacco members made in the first quarter of last year.
“The strong performance by the Bank is in line with the Group’s strategic focus on sustainable growth, resilience, and agility,” said Cooperative Group CEO Gideon Muriuki.
The lender’s total operating income grew by 6.5 per cent from Sh16.8 billion to Sh17.9 billion.
Non-funded income grew faster than interest income, with the lender recording a growth of 10.8 percent in non-interest income to touch Sh7.1 billion.
In the same period last year, Co-operative Bank earned Sh6.4 billion from non-interest income.
Net interest income grew by 3.9 percent from Sh10.4 billion to Sh10.8 billion with the lender growing its loan book in a period that has been characterised by tight liquidity owing to the hike in Central Bank Rate by the Central Bank of Kenya.
Total operating expenses increased by 8.8 per cent from Sh9 billion to Sh9.8 billion.
Last year, the Nairobi Securities Exchange-listed lender (NSE) recommended a dividend of Sh1.50 per share, a 50 per cent increase on the Sh1 paid out last year, a major boost to the cooperative societies, the bank’s majority shareholders.
The bank recorded a 5.7 per cent growth in total assets to Sh631.1 billion to solidify its position as the third largest bank in Kenya in terms of asset value behind KCB and Equity Bank.
The NSE-listed lender made provisions of Sh1.5 billion which have enhanced the bank’s loan loss reserve levels to a high of 72 per cent from 69 per cent in 2021.
The good performance saw shareholders’ funds grow to Sh112.6 billion, a 9.7 per cent increase from Sh102.7 Billion in 2022.