The Co-operative Bank Group has recorded a KSh 10.8 billion after-tax profit for financial year 2020 despite the Coronavirus pandemic.
The lender said the drop in profits was on account of increased COVID-19 related loan loss provisions and the absorption of currency translation losses in its South Sudan’s operations.
The announcement was made by Co-op Bank Group chief executive officer Gideon Muriuki on Thursday, March 18.
“The group has taken loan loss provisions of KSh 8.1 billion, being a 220% increase from KSh 2.54 billion in 2019 in appreciation of the challenges that businesses and households are grappling with from the disruptions occasioned by the ongoing pandemic,” Muriuki said.
The CEO noted the bank would continue to actively engage customers to support them through the tough period by re-aligning the service facilities, funding, and transactional needs as the situation unfolds. In this, Co-op has restructured KSh 49 billion loans as it continues to implement pro-active enterprise risk management initiatives to ensure uninterrupted business operations.
In 2019, Co-op posted a KSh 14.3 billion profit after tax for the full year, 13% growth from KSh 12.7 billion recorded in 2018. Muriuki attributed the surge in profit to the transformation agenda, which he said had re-tooled and equipped the business giving it a competitive edge in the financial market.
It came when the Central Bank of Kenya (CBK) welcomed the lender’s move to take over Jamii Bora Bank, which was struggling.
“The Central Bank of Kenya has been advised by both Co-operative Bank of Kenya Ltd (Co-op) and Jamii Bora Bank of Kenya Ltd (JBB) of Co-op’s interest in acquiring JBB. The proposed acquisition which is subject to regulatory approvals will lead to the acquisition of 100% shareholding of JBB by Co-op,” part of the statement by CBK read.