Co-op Bank Group posted Sh4.98 billion pre-tax profit for the first quarter of 2021 after pandemic shocks slowed growth by 2.6 per cent from Sh5.12 billion same time last year.

The financial institution   posted a further Sh3.46 billion profit after tax  during the quarter compared to Sh3.59 billion in 2020.

Within that period, total assets grew by Sh82.5 billion to Sh553 billion from Sh470 billion same period last year while the net loan and advances hit Sh298.2 billion from Sh276.2 billion.

The group’s First Quarter financials shows that total operating income increased by 15 per cent from Sh2.5 billion to Sh14.4 billion while total non-interest income declined from Sh4.98 billion to Sh4.52 billion on account of fee waivers on economic slowdown.

Loss provisions

Operating expenses also grew by 27 per cent from Sh7.3 billion to Sh9.3 billion on account of higher loan-loss provisions.

Loss provisions increased to Sh2.3 billion as harsh economic condiions cotniued to harnague businesses and households amid the ongoing pandemic.

“A total of Sh49 billion in loans have been restructured to support customers impacted by the pandemic,” said Coop Bank Group chief executive Gideon Muriuki in a statement.

The group’s investment in government securities increased by Sh50.3 billion to hit Sh166.2 billion compared to Sh115.9 billion same time in 2020.

Shareholder funds

On the back of the tough times, shareholders’ funds increased to Sh93.7 billion from Sh82 billion in 2020 enabling the lender to pitch for big deals.

Muriuki said to cushion the business, the lender continued to leverage digital channels to support uninterrupted access to banking services by customers.

“Over 93 per cent of our services are now on alternative banking channels,” he said.

Coop Bank has successfully moved 93 per cent of all customer transactions to alternative delivery channels.

It says it also expanded 24-hour contact centre, mobile banking, 580 ATMs, internet banking and over 24,000 Co-op Kwa Jirani banking terminals.

“To date we have disbursed Sh24.9 Billion to MSMEs through our E-Credit solution,” said the chief executive.

Subsidiaries

The lender’s subsidiary Co-op Consultancy and Insurance Agency posted Sh262.6 billion profit before tax as at 31st Mar 2021, leveraging bancassurance business.

Co-operative Bank of South Sudan, which is a joint venture (JV) partnership with Government of South Sudan where Co-op Bank holds 51 per cent against 49 per cent posted Sh89.1 million monetary lose in Q12021 on hyperinflation which devalued the South Sudanese pound.

Co-op Trust Investment Services contributed Sh21.3 million in profit before tax in Q1,2021, with funds under management standing at Sh128.4 billion compared to Sh106.58 billion as at Q1,2020.

Kingdom Bank Limited managed Sh126.7 million profit before tax compared to 2020 full year loss of Sh124 million.

Co-op Bank holds a controlling 90 per cent equity interest in Kingdom Bank, which is a fully-fledged commercial bank with over 444,000 customers in 17 branches.