Co-operative Q1 profits shrink marginally to Ksh.3.5B

The Co-operative Bank of Kenya has posted a marginal profit dip with earnings through three months to March falling slightly by 2.8 per cent to Ksh.3.5 billion.

The truncated profitability is largely attributable to increased operating expenses which soared by 27 per cent to Ksh.9.3 billion from Ksh.7.3 billion on the back of higher loan-loss provisions.

“The group prudentially increased loan loss provisions to Ksh.2.3 billion in the first quarter of 2021, in appreciation of the challenges that businesses and households continue to face due to the economic effects of the ongoing pandemic,” noted Co-operative Bank Managing Director Gideon Muriuki.

At the same time, the lender’s non-interest funded income shrunk by nine per cent to Ksh.4.5 billion on account of fee waivers.

Nevertheless, Co-op still posted a 31 per cent growth in net interest income to Ksh.9.8 billion from Ksh.7.5 billion.

Similarly, the bank’s net loans and advances grew by eight per cent to Ksh.298.2 billion while customer deposits expanded by 16 per cent to Ksh.393.8 billion.

During the period, the lender’s newest subsidiary- Kingdom Bank Limited pulled itself into the profitable zone with a profit before tax (PBT) of Ksh.126.7 million compared to a Ksh.76 million full year loss.