Co-operative Bank on Monday paid out a total dividend of Sh8.8 billion to its investors, following approval by shareholders in the virtual annual general meeting held last month.

    The lender, which is listed on the Nairobi Securities Exchange, becomes the second bank after Stanbic to share its profits with its owners.

    Co-op board had recommended a dividend of Sh1.5 per share, amounting to Sh8.8 billion, matching that of the previous year.

    The top shareholder, Co-op Holdings Co-operative Society Limited, received Sh5.68 billion on its 64.56 percent stake.

     

     

    Co-op Bank posted a 5.2 percent growth in net profit to Sh23.2 billion in the financial year ended December 2023 on increased income and reduced operating costs.

    The net profit grew from Sh22 billion posted in a similar period in 2022.

    “The strong performance has led to a sustained increase in shareholder value as reflected in the competitive return on equity of 21 percent,” said Gideon Muriuki, managing director at Co-op Bank.

    “The Co-operative Bank Group continues to pursue strategic initiatives that focus on resilience and growth in the various economic sectors.”

    Other banks that have since closed their books and await payment of dividends to their shareholders include Diamond Trust Bank and Equity Bank which will make the payouts on June 28 and June 29, respectively.

     

     

    Listed banks accounted for nearly half of all the dividends paid out by the Nairobi Securities Exchange firms, with the lenders expected to fork out a total of Sh66.4 billion to their shareholders.

    The high absolute payout by the banking sector has attracted investors to the bank counters at the NSE, which has been reflected in the increased share price seen this year.

    Mr Muriuki, Equity Bank CEO James Mwangi, the Kenyattas, and the Ndegwa family are some of the shareholders that will benefit from the windfall in dividend payout.

    Year-to-date Co-op Bank’s share prices have increased by 14.05 percent to trade at Sh13.8.

    Equity Bank, NCBA, and Standard Chartered have also seen a pickup in their counters at the Nairobi bourse after they declared dividends.

    The Housing Finance Group and KCB Group were the only non-dividend paying counters in the banking with the latter attributing its non-payment to the need to preserve its capital adequacy buffers going into 2024 amid elevated expenses including high cost of provisioning against loan defaults.

     

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