Kenya's Co-op bank posts rise in profit

by Reuters 0

Co-operative Bank of Kenya Ltd on Thursday posted a 34 percent rise in pretax profit for the first nine months of 2015, boosted by cost-cutting that helped improve its cost-to-income ratio.

Chief Executive Gideon Muriuki said full-year profit was expected to be 28 percent to 35 percent higher than 2014, and could possibly even exceed those projections.

Muriuki said the bank had cut headcount by about 11 percent and there was likely to be a jump in comparative full-year profit as the cost of the staff restructuring programme dented final-quarter earnings in 2014.

“We will do well in the third quarter and the last quarter (this year),” he told an investor briefing on Thursday.

The bank’s pretax profit for the period was 12.2 billion shillings ($119.7 million), compared with 9.1 billion shillings a year earlier. Growth in the bank’s loan book also spurred a 16 percent rise in net interest income to 17.38 billion shillings.

The lender said its cost-to-income ratio had declined to 49 percent from 58.2 percent at the end of last year.

Muriuki said the bank planned regional expansion after its South Sudan joint venture became profitable in the first nine months of the year.

“We are looking at Rwanda, Uganda, Tanzania and Ethiopia in the next five years,” he said.

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