Co-operative Bank has posted a Sh22 billion net profit for the financial year that ended in December, a 33 per cent jump from the previous period.
The lender recommended a dividend of Sh1.50 per share, a 50 per cent increase on the Sh1 paid out last year, a major boost to the co-operative societies, the bank’s majority shareholders.
“The strong performance has led to a sustained increase in shareholder value as reflected in the competitive return on equity of 21.2 per cent,” Co-op Bank chief executive Gideon Muriuki said yesterday.
Co-op Bank’s operating income grew by 17.9 per cent from Sh60.4 billion to Sh71.3 billion. Total non-interest income rose by 32.7 per cent from Sh19.4 billion to Sh25.7 billion.
Net interest increased at a slower rate at 10.9 per cent from Sh41 billion to Sh71.3 billion. The lender’s expenses increased by 10.9 per cent from Sh38.1 billion to Sh42.2 billion.
Meanwhile, Absa Bank reported a 34.2 per cent net profit growth in the year ended December, largely supported by increased lending with net interest income growing ahead of non-funded income by 27.7 per cent to Sh32.3 billion.
By comparison, non-interest income grew 17.7 per cent from Sh11.7 billion to Sh13.7 billion with foreign exchange trading income hitting Sh6.6 billion in the period.
Following the good performance, Absa Bank raised its dividend payout to a record of Sh1.35 per share or a total of Sh7.3 billion as interest income boosted its earnings in the year.
The lender declared a final dividend of Sh1.15 per share to be distributed on May 25 to shareholders on record as of April 28. This is in addition to an interim payout of Sh0.2 which was disbursed last year.
The total dividend for the review period has been raised 22.7 per cent from Sh1.1 per share in the year before.