Co-operative Bank of Kenya eyes regional markets to grow

Co-operative Bank of Kenya is seeking to expand into neighbouring countries. The lender announced Friday during its Annual General Meeting (AGM) that it intends to expand to Rwanda, Uganda, Ethiopia and Tanzania. Already, the bank has made a strong foothold in South Sudan where in the last financial year, it made a profit before tax of Sh850 million.

Co-op Bank CEO Gideon Muriuki

“We intend to make our presence felt regionally, since neighbouring markets are welcoming and seem to respond positively to Kenyan banks,” Chief Executive Officer Gideon Muriuki said during the AGM at the Bomas of Kenya. However, Muriuki said the bank intends to concentrate more on putting up shop in Ethiopia due to it’s large population.

“Ethiopia has a population of 80 million. In the past, the country followed a socialist economic model in which its market was closed to outside players like Kenya. But now, things have changed and the new regime is inviting investors, especially banks to help with financing the numerous infrastructural projects it is undertaking. We intend to take advantage of these new developments and be the first there,” Muriuki added.

The bank also announced that it was stepping up its investments in other fields, already having about 35 per cent stake in CIC Insurance and controlling stake in Bob Mathews stock brokerage firm, that was renamed Kingdom Securities. The lender announced a 80 cents payout as dividends to shareholders for every ordinary share held. This was a 60 per cent increase in pay-out as compared to 50 cents per share paid out in last year.

“The bank has maintained a solid dividend track record on the back of sustained profitability. 2015 was particularly exceptional with profit before tax standing Sh15.38 billion as compared to Sh10.92 billion recorded in 2014, a 41 per cent growth, one the highest in the industry,” Muriuki said.

The AGM re-elected Macloud Malonza, Richard Kimanthi and Benedict Simiyu for another term of three years after majority and strategic shareholder Co-op holdings Co-operative Society Limited nominated them for re-election. Mr Stanley Muchiri was also re-elected for another term of three years after Co-opholdings Co-operative Society Limited nominated him for re-election.

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