Co-operative Bank has received regulatory approval from the Central Bank of Kenya to embark on a Joint Venture with South Africa’s leasing company Super Group Limited.
Through the partnership, the country’s second largest lender, by market share, is seeking to expand its asset base leveraging on major infrastructure projects, increased government acquisitions of equipment through leasing, exploration and mining activities in oil and gas subsectors.
The bank is banking on the new partnership for growth amidst a tough operating environment blamed primarily on the introduction of laws capping interest rates on loans. The lender yesterday revealed that its net profit for six months ended June 30 dropped by 10.81 per cent to Sh6.6 billion from Sh7.4 billion on reduced interest income.
For the period, the bank’s loans and advances increased by Sh31.3 billion or 14.14 per cent to Sh252.6 billion compared to Sh221.3 billion, while customer deposits rose marginally by 2.72 per cent to Sh287.2 billion from Sh279.6 billion. Interest income fell by 10.29 per cent to Sh29.26 billion compared to Sh21.47 billion.
“This is a commendable performance against the backdrop of a tight operating environment especially with the capping of interest rates, general economic slowdown, currency devaluation and hyperinflation in South Sudan,” MD Gideon Muriuki said.