Coop bumps up dividend pay to Sh8.8 billion
Cooperative Bank has bumped up dividend 51 percent to Kes8.8 billion following a 33 percent jump in profitability to Kes22 billion.
Co-op profits rose sharply on a jump in non-interest income supported by higher returns from fees and commission.
Non-interest income grew by 32.7 percent Kes25.7 billion outpacing the 10.9 percent rise in net interest income growth to Kes45.5 billion.
The lender has joined the list of banks that have increased payout to shareholders, a timely boost under the current tough macro economic environment in the country.
“The strong performance has led to a sustained increase in shareholder value as reflected in the competitive Return on Equity of 21.2 percent,” Co-op CEO Dr Gideon Muriuki said.
“The Board of Directors has recommended a dividend of Kes1.50 per share, subject to approval by the regulators and shareholders. The proposed dividend represents a 50 per cent enhancement on the Kes1.00 per share paid out last year”.
The lenders strong digital push has seen 92 percent of all customer transactions move to alternative channels that has seen the bank lend Kes7 billion a month via mobile phones increasing key revenues, fees and commissions while keeping costs low.
The lender said through its all-telco Mco-op Cash Mobile Wallet the bank has registered 5 million customers and issued loans worth Kes84.2 billion year-to-date.
Cooperative Bank has also managed to turn around Kingdom Bank with the small business lender profits rising 87.1 percent to Kes930 million in the full year ending December.
Formerly Known as Jamii Bora that was struggling before Cooperative Bank acquired it in 2020, the SME focused bank has attracted deposits up to Kes9.6 billion that has seen its lending rise 40 percent to Kes6.2 billion.
Kingdom Bank which contributed just 4.2 percent of Cooperative Bank’s Kes22 billion net profits for the year ending December 2022 shows the potential of the lenders new acquisition in banking small and medium businesses.
Th subsidiary is crucial in complementing Cooperative Bank’s unique model of retail banking services through Sacco FOSAs enabling the lender to provide wholesale financial services to over 484 FOSA outlets.
Other subsidiaries, Co-op Consultancy and Bancassurance Intermediary Ltd made Kes1.01 billion before taxes riding on strong penetration of Bancassurance business while Co-op Trust Investment Services contributed Kes208.1 million in gross profits.
Co-operative Bank of South Sudan that is a unique joint venture (JV) partnership with Government of South Sudan (Co-op Bank 51 percent and GOSS 49 percent) returned a profit of Kes132.7 Million in FY2022 compared to a loss of Kes421.7 million in FY2021.