Co-operatives Societies, who are majority shareholders in the Co-operative Bank of Kenya with a 64.5% stake, are set to receive a huge dividend payout.
This follows a significant jump in the full year in net profit registered by the lender at the close of the 2022 financial year.
According to the Co-operative Bank of Kenya full-year 2022 financial results, the lender’s net profit increased to KSh 22 billion in 2022 compared to KSh 16.5 billion in 2021, an increase of 33%
Shareholders will receive a total dividend payout of KSh 8.8 billion out of which KSh 5.7 billion will be paid out to majority shareholder CoopHoldings Cooperative Society Limited.
CoopHoldings Cooperative Society Limited is a holding company owned by the cooperative societies within Kenya, who jointly own a controlling majority of shares totalling 65% of all company stock. Co-op Holdings Co-operative Society is the strategic investor representing the Kenya Co-operative movement.
The remainder is owned by individual and institutional investors through the Nairobi Securities Exchange(NSE).
The lender’s 2022 full-year results indicate that its balance sheet size grew by 4.7% to KSh 607.2 billion while net loans and advances increased by 9.5% to KSh 339.4 billion.
Co-operative Bank of Kenya customer deposits grew by 3.9% to KSh 423.8 billion.
Directors of the Bank have recommended a 50% increase in dividend per share of KSh 1.50 compared to KSh 1 per share paid out the previous year, a significant gain to cooperative societies that are the majority shareholders.
According to Dr Gideon Muriuki, the Co-operative Bank of Kenya Chief Executive, this significant jump in the financial performance of the lender is attributed that has been a boost to shareholder value as reflected in the competitive return on equity of 21.2 per cent.
The lender also recorded an increase in its non-interest income-including fees and commissions while its cost-to-income ratio fell to 47.1% in 2022 from 59% in 2021.
Co-op Bank of Kenya recorded a 9.4% increase in net loans and advances to customers to KSh 339.4 billion, pushing up the lender’s net interest income to KSh 45.5 billion from KSh 41 billion in 2021. The lender registered a 17.9% jump in operating income to KSh 71.3 billion in 2022 from KSh 60.4 billion in 2021.
The lender posted a 3.9% increase in customer deposits to KSh 423.8 billion in 2022 from KSh 407.7 billion in 2021 while its balance sheet size grew by 44% to KSh 607.2 billion from KSh 579.8 billion in 2021.
