Tag: Kingdom Bank news

Co-op Bank Leads the Pack with Ksh18.2 Billion in Profits (Before Tax) in 1st Half of 2024

Posted on by Kibaki Muthamia

Co-op Bank is pleased to report a Profit Before Tax of Kshs.18.2 Billion for first half 2024, a commendable 10.7% growth compared to Kshs. 16.4 Billion recorded in Half 1 2023.

This represents a Profit after Tax of Kshs. 13.0 Billion compared to Kshs. 12.1 Billion reported in 2023.

The strong performance by the Bank is in line with the Group’s strategic focus on sustainable growth, resilience, and agility delivering a Return on Equity of 22.1%

Inclusion to the MSCI Index

The Bank has been added to the MSCI Index. The MSCI Kenya Index, created by Morgan Stanley Capital International (MSCI), tracks the performance of large and mid-cap listed companies in Kenya, providing foreign investors with an up-to-date picture of the state of the Nairobi Securities Exchange (NSE), allowing them to make informed investment decisions.

Key Performance highlights:

  1. Financial Position: The Group has registered strong growth as follows.
  • Total Assets grew to Kshs.716.9 Billion, a 7.8% growth from Kshs 664.9 Billion in the same period last year.
  • Net loans and advances grew to Kshs. 375.6 Billion, a 2.8% growth from Kshs.365.4 Billion in 2023.
  • Customer deposits grew to Kshs. 507.4 Billion, a 9.4% increase from Kshs. 463.9 Billion.
  • External funds from development partners were Kshs. 50.2 Billion compared to Kshs.59.4 Billion in 2023.
  • Shareholders’ funds have grown to Kshs. 126.7 Billion, a 17% increase from Kshs. 108.3 Billion in 2023 driven by the strong growth in retained earnings of Kshs. 15.1Billion.
  1. Comprehensive Income
  • Total operating income grew by 10.9% from Kshs. 35.4 Billion to Kshs. 39.2 Billion.
  • Total non-interest income grew by 11.2% from Kshs. 13.8 Billion to Kshs. 15.4 Billion.
  • Net interest income grew by 10.7% from Kshs 21.5 Billion to Kshs 23.9 Billion.
  • Total operating expenses grew by 11.1% from Kshs 19.1 Billion to Kshs. 21.3 Billion.
  1. Cost Management 

The Group reports excellent efficiency gains from the various initiatives to record a Cost-to-Income Ratio of 46.6% in 1H2024 from 59% in FY2014 when we began our Growth & Efficiency journey.

  1. A Strong Digital Footprint

A New Core Banking System, offering opportunity for growth and enhanced efficiency

The Bank continues to leverage the new core banking system (latest version of Finacle from Infosys, one of the best-rated platforms globally), to support the Group’s digital synergy.

The system will further enhance service excellence and provide innovative and advanced banking solutions.

  • Through our digital channel strategy, the Bank has successfully moved over 93% of all customer transactions to alternative delivery channels, a 24-hour contact centre, 604 ATMs & Cash Deposit Machines (CDMs), mobile & internet banking and over 17,000 network of Co-op kwa Jirani agents.
  • Our Omni-channel platform continues to offer users accessibility and enhanced experience. The platform interfaces online banking through personal computers, mobile phones and USSD availing our services to all customers through their preferred channel yet retain the same user experience from wherever they are.
  • Mco-op Cash Mobile wallet continues to drive substantial non-funded income streams with Kshs 36.4 Billion in loans disbursed in 1H2024, averaging 6.1 Billion per month.
  • Over 223,000 customers have taken up the MSME packages rolled out in 2018, with 63,500​ trained on business management skills. In H12024, we disbursed 7.5 Billion to MSMEs through our Mobile E-Credit solution. MSMEs make up 15.9% of total Loan Book.
  • Our unique model of retail banking services avails access to cash for FOSA operations, enabling 484 FOSA outlets to support over 15 million Sacco members access banking services even in rural/remote areas.
  1. Wide and Expanding Branch Network

The Branch network has expanded to a total of 199 outlets (4 in South Sudan).

15 additional outlets are planned to open this year, with 2 at Imaara Mall on Mombasa Road-Nairobi and Ugunja in Siaya already opened.

  • Kingdom Bank, a subsidiary of the Bank, opened its 22nd branch in Meru County, being the third branch opened this year. The new branch has a key focus in supporting the dynamic agricultural community in Meru and its surrounding areas, in addition to becoming a catalyst for local business growth and development.
  • Co-operative Bank of South Sudan opened its fifth branch in Wau, supporting business growth and financial inclusion in South Sudan.
A roadshow in the streets of Meru Town on the opening of a branch of Kingdom Bank (Image: Facebook)
  1. A Growing Team

The Bank continues to invest in a competitive team set to serve at existing functions at the same time tap new growth opportunities across all areas of the business.

Staff Numbers have grown from 4,864 as at the close of 2022 to 5,426, creating job opportunities for over 562 young people.

  1. Subsidiaries
  • Co-op Bancassurance Intermediary Ltd posted a Profit Before Tax of Kshs 682.7 Million in 1H2024, riding on strong penetration of Bancassurance
  • Co-operative Bank of South Sudan that is a unique joint venture (JV) partnership with Government of South Sudan (Co-op Bank 51% and GOSS 49%) made a Profit Before Tax of Kshs 264.3 Million in 1H2024.
  • This performance however translated to a monetary loss of Kshs. 252.4 Million attributable to hyperinflation accounting occasioned by currency devaluation of the South Sudan Pound.
  • Co-op Trust Investment Services Ltd contributed Kshs. 142.7 Million Profit Before Tax in 1H2024 compared to Kshs. 106.8 Million in 1H2023, a commendable 33.7% growth. The Subsidiary has Funds Under Management of 231.3 Billion.
  • Kingdom Bank Limited (A niche MSME Bank) contributed a Profit Before Tax of 635.5 Million in 1H2024, a remarkable growth of 21.8% from Kshs. 521.9 Million reported in 1H2023.
  1. Accolades 

The Bank was named Best Bank in Kenya by Global Finance in their World’s Best Banks 2024—Africa Awards.

The Bank was recognized for recording phenomenal growth riding on a network of over 17,000 agents and a solid digital footprint, facilitating 93% of transactions via digital channels.

  1. Commitment to Sustainability 

In 2022, the Bank embarked on an enhanced Environmental, Social and Governance (ESG) roadmap to integrate ESG considerations into its operations with several key milestones achieved.

We have, in line with Sustainable Development Goals (SDG) number 13 ‘Take urgent action to combat climate change and its impacts’ embarked on a Climate Risk Project with the aim of formulating an effective Climate Strategy Roadmap and Implementation Plan to chart a clear path towards our climate goals.

Co-op Bank Foundation, the Group’s social investment vehicle, continues to provide 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 supported 11,043 students since inception.

Conclusion 

The Co-operative Bank Group continues to pursue strategic initiatives that focus on resilience and growth in the various economic sectors.

This is anchored on a successful universal banking model supported by an innovative digital presence, a wide physical footprint, and the unique synergies in the over 15-million-member co-operative movement that is the largest in Africa.

Kingdom Bank Invests in Farmers and Stakeholders in Support of Sustainable Economic Growth

Posted on by Kibaki Muthamia

Agriculture is an important economic activity for Kenya contributing to approximately 33% of the country’s GDP and employing more than 40% of the total population.

Over the recent years, we have seen Government, the private sector and development agencies join hands in working towards the revolution of the sector to propel the country forward in terms of increasing food security and building resilience for communities and the country at large.

While great strides have been made, more can still be done to support the agriculture value chain players to enhance their production, improve their quality and above all add value to the agriculture products through processing.

The potential of the sector though huge, remains moderately untapped mostly due to a lack of sufficient financing, poor agricultural practices and a limited number of extension services to support farmers.

Kingdom Bank, a subsidiary of the Co-operative Bank of Kenya, has invested in supporting the sector through various strategies that have proven effective, inclusive and impactful not only on its customers but also on the sector at large.

Gertrude Mjomba and Simon Mwang’ombe from Dannde Oils exhibited their coconut-based products at the Kingdom Bank stand during the 2023 Agriculture Society of Kenya Nairobi International Trade Fair.

First, the Bank has a dedicated agribusiness unit that focuses on empowering farm input providers, farmers, food processors and distributors. The empowerment of these value chain players is in the form of financial support through the provision of savings, loans, investment, digital financial solutions and payment platforms that allow these players to scale their agribusiness ventures.

Although many other banks also extend agriculture financing, Kingdom Bank’s value proposition is hinged on personalized relationship management and superior client servicing. This means that each customer is mapped to a Relationship Manager who handles their day-to-day operations and also extends financial advisory services as a value add to customers.

In addition, the bank has signed extensive partnerships with other stakeholders in the industry including motor vehicle and equipment service providers, SME trainers and key government institutions to offer farmers within the bank network affordable solutions that can support them in mechanizing their operations, growing their output and enhance their efficiency when it comes to agriculture.

This concerted effort has seen the bank advance over Ksh 62 million to the agriculture sector from the year 2021 to date. This loan distribution forms a huge percentage of the bank’s active loan book showcasing a commitment to support farmers and the agriculture value chain.

In fact, the support to the sector has not gone unnoticed with the Agriculture Society of Kenya feting Kingdom Bank with several accolades in the 2023 circuit of the ASK shows and trade fairs for having the Best Bank Stand.

Kingdom Bank stand at the recently concluded 2023 Agriculture Society of Kenya Nairobi International Trade Fair at the Jamhuri Showground.

“This is the first year the bank has participated in the agriculture shows and we successfully exhibited our brand, our solutions and our promise to our customers across the country in Kisii, Kisumu, Nakuru, Mombasa, Nyeri and Nairobi allowing us to also engage with agriculture players and identifying other areas in which we can support them,” said Kevin Muendo the Head of Micro Credit and Agribusiness at Kingdom Bank.

He also added that the bank remained intentional about creating market linkages for its customers and that is why several were able to exhibit their solutions at the bank’s stands in the shows. This includes among others, Dannde Oils, an enterprise run by two ambitious youths who process coconut to produce oil, coconut sugar, coconut flour and other by-products including cookies and other snacks.

Knights Energy a customer of the bank that provides solar solutions for industrial, commercial and residential use was also present at the Nairobi International Trade Fair showcasing their solutions within the clean energy space at the bank’s stand. In fact, Knights Energy powered the Kingdom Bank stand using solar power showcasing a commitment to embrace clean energy.

So the next time you want agriculture financing, think Kingdom Bank.

Simply walk into any of their branches countrywide and engage them based on your needs. Alternatively, call them on 0709 881 300 for support.