Co-op Bank Group has reported a Profit before Tax of Ksh14.3 billion for the financial year 2020 compared to Ksh20.7 billion recorded in 2019 and a Profit after tax of Kshs 10.8 billion compared to Kshs 14.3 billion in 2019.
The reported amounts represented a 23 percent reduction on account of increased Covid-19 related loan loss provisions and the absorption of currency translation losses in our South Sudan operation.
The Group has taken loan loss provisions of Ksh8.1 Billion, being a 220 percent increase from Ksh2.54 billion in 2019 in appreciation of the challenges that businesses and households are grappling with from the disruptions occasioned by the ongoing pandemic.
"We continue to actively engage our customers to support them through this period, by re-aligning the servicing of facilities, funding, and transactional needs as the situation unfold. A total of Ksh49 billion in loans have been restructured to support customers impacted by the pandemic," Co-op Bank Group Managing Director and CEO Gideon Muriuki announced.
The Group has sustained the Balance Sheet growth with an Asset Base of Ksh537 billion as at December 31, 2020.
The Group continues to implement proactive enterprise risk management initiatives to ensure uninterrupted business operations.
"Fortification of our digital channels to support uninterrupted access to banking services by customers; over 92 percent of our services are now on alternative banking channels.
"Enhancement of digitization of internal bank processes and engagement platforms, to build contactless capabilities for both customers and staff. Adoption of work-from-home model for the safety and wellness of bank teams, and ensuring safe spaces for staff who continue to serve in physical touchpoints," Muriuki added.
Total operating income grew by 11.1 percent from Ksh48.5 billion to Ksh53.8 billion. Total non - interest income grew by 1.9 percent from Kshs 17.2 billion to Kshs 17.5 billion. Net interest income grew by 16.1 percent from Ksh31.3 billion to Ksh36.3 billion.
Total operating expenses grew by 41.7 percent from Kshs 27.8 billion to Ksh 39.4 billion on account of higher loan loss provisions.
He further explained that through their multi-channel strategy, the Bank had moved over 92 percent of all customer transactions to alternative delivery channels, and expanded 24-hour contact centre, mobile banking, 576 ATMs, internet banking, and over 23,000 Co-op Kwa Jirani banking terminals .
In the MSME financing, the Group secured a long-term financing facility from the IFC ( International Finance Corporation ) amounting to Ksh8.25 billion for on-lending to MSMEs at affordable terms.
The proceeds of the facility will support customers to better cope with the disruptions brought about by the pandemic, especially those operating in the following key business areas.
Businesses undertaking Climate-Smart projects, including agricultural inputs and sustainable agricultural practices, renewable energy, energy efficiency, and related areas.
Co-operative Bank Foundation has provided Scholarships to gifted but needy students from all regions of Kenya. The sponsorship includes; fully paid secondary education, full fees for University education, Internships, and career openings for beneficiaries.
The foundation is fully funded by the bank and has so far supported 7,713 students since the inception of the program.
The bank also gave a cash donation of Ksh100 Million to the Covid 19 Emergency Respond Fund.
"Being cognizant of the huge role that we play in supporting communities especially during this period , we continue to operate in an economically, socially and environmentally - responsible manner," Muriuki explained.
While maintaining adequate capital buffers in light of the current operating environment , the Board of Directors has approved a dividend payment of Ksh1 per ordinary share held (2019 - Ksh1 ) to be paid on or about April 14, 2021 to the shareholders registered on the Bank's Register at the close of business on March 31, 2021.
"This will be a much-needed relief in a pandemic year to the over 15 million member Co-operative movement that predominantly owns the bank," the Group CEO added.
Co - op Bank was named Bank of The Year in Kenya, in The Ft Banker 2020 - Awards run by the Financial Times of London.
Co-op Bank was named Best Bank in Kenya at the African Banking Awards 2020 organised by EMEA Finance This is the third time around, having also won in 2018 and 2019.