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The bank's Chief Executive Officer Gideon Muriuki says the performance indicates the new strategy is working and will propel the bank to greater heights despite a tough operating environment/COURTESY

Kenya

Co-op Bank defies interest rates cap, grows profit by 8pc

The bank’s Chief Executive Officer Gideon Muriuki says the performance indicates the new strategy is working and will propel the bank to greater heights despite a tough operating environment/COURTESY

NAIROBI, Kenya, Mar 17 – Co-operative Bank is the first financial institution to report an increase in profit for 2016 recording an 8.2 per cent net profit growth in the year ended December to hit Sh12.6 billion compared to Sh11.7 billion the year before.

Management attributes the rise to increase in lending as the loan book increased by 11 per cent to Sh236.9 billion, rising interest income by 14.8 per cent to Sh42.2 billion.

Total assets grew by Sh9.5 billion to Sh352 billion compared to Sh342.5 billion in the same period last year.

Customer deposits however dropped by a marginal 1.9 per cent to Sh260.1 billion.

The bank also suffered hyperinflation accounting occasioned by currency devaluation in South Sudan making a loss of Sh498.3 million in the period under review.

The bank’s Chief Executive Officer Gideon Muriuki says the performance indicates the new strategy is working and will propel the bank to greater heights despite a tough operating environment.

The bank has declared a dividend of Sh0.8 per share, the same as the payout for the previous year.

The dividend will be paid on June 30 to shareholders on record as of May 26.

KCB Group posted flat net profit while Barclays’ net profit dropped 12 per cent; Equity’s declined 4.1 per cent to Sh16.6 billion.

Stanbic Holdings also reported a 10 per cent drop in 2016 net profit.

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