Co-operative Bank Group says it has restructured loans totalling Ksh 15.3 billion representing 5.5 per cent of its total loan book due to coronavirus pandemic.
This comes as the lender recorded a Profit After Tax amounting to Ksh 3.6 billion in the first quarter ending March 31 2020.
Group Chief Executive Officer Gideon Muriuki attributes the growth to a rise in non-interest income which surged 19 per cent to stand at Ksh 5 billion as well as increased transactions on alternative channels.
The economic fallout brought about by the coronavirus pandemic continues to unfold as the majority of sectors initiate measures to adjust to the situation.
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In the banking sector, most banks are now grappling with managing their loan book embarking on restructuring the has now surpassed Ksh 150 billion since March.
According to Co-operative Bank loan, negotiations included customers requiring an interest moratorium period, customers requiring a better structure/longer repayment period and customers requiring additional funding to manage the crisis.
In the first quarter of the year, the bank added Ksh 24.5 billion in its loan book to stand at Ksh 276.2 billion representing a 9.8% growth.
This was mainly driven by mobile loans through its M-Coop Cash which advanced loans totalling Ksh 16 billion during the period.
Total operating income grew by 12.5% from Ksh 11.1 billion to Ksh 12.5 billion.
However, total operating expenses grew by 20.6% from Ksh 6.0 billion to Ksh 7.3 billion owing to higher loss loan accounts provisions and staff expenses.
Total assets grew 10.5% to stand at Ksh 470.4 billion compared to the same period last year.
On the other hand, customer deposits grew by 6.9% to Ksh 339.6 billion.
The bank says planned acquisition of Jamii Bora Bank okayed by shareholders in March this year will offer it the opportunity to cross-sell and deepen product offering to the enhanced customer base and create a niche bank to offer specialized credit offerings that include MSMEs.
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