The Co-operative Bank Group has restructured loans worth Ksh15 billion in the first quarter of 2020 to support customers during the Covid-19 pandemic, financial results released on Thursday, May 21, reveal.
With many sources of income affected by the pandemic, the bank engaged customers seeking a longer repayment period, those in need of an interest moratorium period and those seeking additional funding to sustain operations during the pandemic.
For Quarter 1, 2020, the bank recorded a profit before tax of Ksh5.1 billion. Profit after tax was Ksh3.6 billion.
In a statement, the bank acknowledged the impact of the pandemic on its operations, disclosing that it had prompted an accelerated shift towards digital channels.
"The group has put in place a comprehensive mitigation strategy intended to ensure full banking services continue being accessible to customers in a safe environment consistent with the Ministry of Health guidelines.
"In this regard, we continue to leverage our digital channels while ensuring that all branch outlets remain open to offer service, with due regard to health and safety of both customers and bank teams," it read in part.
It was revealed that 90% of customer transactions were undertaken on alternative delivery channels including mobile banking, 176,000 Co-op Kwa Jirani agents, 584 ATMs and its 24-hour contact centres.
The focus on digital banking was also evident as loans worth Ksh16 billion were disbursed on the mobile MCo-op Cash service in the first quarter of 2020, with Ksh5.6 million customers registered.
It was further confirmed that talks were progressing between Co-op Bank and Jamii Bora Bank with a view to Co-op acquiring 100% shareholding in Jamii Bora.
With 350,000 customers, Jamii Bora has cut a niche for itself in MSME banking, microfinance, youth and women banking, asset finance and leasing, areas that are all key to Co-op's long-term strategy.
Total operating income grew by 12.5% from Ksh11.1 billion in the same period in 2019 to Ksh12.5 billion in Q1 2020.
Total non-interest income also rose by 19% from Ksh4.2 billion to Ksh5 billion.
Net interest income increased by 8.5% from Ksh6.9 billion to Ksh7.5 billion.
Total operating expenses grew as well, increasing by 20.6% to hit Ksh7.3 billion from Ksh6 billion on account of higher loan loss provision and staff expenses.
Notably, total assets also grew by Ksh44.7 billion to Ksh470.4 billion from Ksh425.7 billion in the first quarter of 2019.