Coop Bank turns to retail banking to bolster earnings

By James Anyanzwa

Nairobi,Kenya:Cooperative Bank Group plans to tighten its grip on retail banking to shore up its earnings and improve returns to shareholders.

At the same time, the bank said plans to establish Cooperative Bank of Southern Sudan is at the final stage. The first branch set to be opened in July 2013.

Managing Director and Chief Executive Gideon Muriuki (pictured) said the bank would continue with its growth strategies on the balance sheet and profitability by enhancing its transaction-based income.

He said the bank has crafted elaborate plans to expand its customer base and increase its foot print in line with the county government structure.

This will be done by opening more branch locations and increasing its ATM network to 550 outlets. “The bank is expected to grow and perform even better in the years to come thereby significantly improving the shareholder value and return,” Mr Muriuki told shareholders in Nairobi yesterday.

Muriuki who was speaking during the bank’s 5th Annual General Meeting (AGM) said the establishment of Cooperative Bank’s subsidiary in Southern Sudan would help it grow revenues and support its regional customers.

He said the bank would also continue rolling out agency banking, enhance mobile banking service and also focus on providing whole financial services to boost its revenues.

Shareholders approved a dividend payout of 50 cents per share for the year ended December 31, 2012 representing a 25 per cent growth from the previous year’s 40 cents per share.

The group’s pre-tax profit for the three months period ended March jumped 31 per cent to Sh3.23 billion, up from Sh2.47 billion in a similar period last year helped by growth in transaction-based income, cost management and enhanced efficiency in business operations.

The growth underpinned the bank’s continued good performance in line with its strategic focus of progressively growing its balance sheet and transaction-based incomes.

Muriuki noted that customer base increased to more than 3.3 million account holders owing to a concerted effort by all staff to bring funded accounts in the bank.

The bank opened five additional branches during the first quarter (January-March),  bringing the total branch network to 119.