Kenya’s Co-op Bank expects its 2014 profits to increase

Co-operative Bank of Kenya reported on Wednesday a 9 percent rise in pre-tax profit for 2013 and said it expected better growth this year thanks to the expansion of its branch network and technology infrastructure. In a statement, the bank said, “With the major investment in the branch network, ICT infrastructure and new operations in South Sudan, we expect the growth momentum to be sustained and better profitability in 2014.”

Co-operative Bank also said its pre-tax profit rose to 10.87 billion shillings from 9.98 billion shillings, adding it had widened its income base with more customer accounts and new branches. In addition, the lender, which mainly serves co-operatives and individuals in east Africa’s biggest economy, said its net interest income rose 19 percent to 18.6 billion shillings.

The bank began operations in South Sudan in September last year and Co-operative Bank said its total assets rose 15 percent to 231.2 billion shillings from 200.8 billion shillings in 2012. Furthermore, Net loans also increased 15 percent to 137 billion shillings.

The bank went on to say it had also upgraded its core banking system and was expected to launch a newer version of its mobile and internet banking services by the second quarter of the year. Earnings per share rose to 2.19 shillings from 1.84 shillings previously. It also recommended a dividend payment of 0.50 shillings per share proposed a bonus share issue of one new ordinary share for every six held.

Kenyan banks including the largest lender by depositors, Equity Bank, and the biggest by assets, KCB, posted double-digit earnings growth last year, though rising bad debts have curbed pre-tax profit.

Source: The Africa Report