Co-operative Bank of Kenya recorded a solid performance in Q3’2025, highlighting the institution’s resilience amid a challenging macroeconomic environment marked by elevated interest rates, slower private-sector credit uptake, and rising credit risk. The Bank’s Profit After Tax (PAT) grew by 12.3% to KES 21.6 bn, from KES 19.2 bn in Q3’2024. The performance was largely supported by strong growth in total operating income, which rose by 13.9% to KES 67.4 bn, buoyed by the continued expansion of the loan book and increased allocation to high-yield government securities. However, the gains were partially weighed down by a 15.4% rise in operating expenses to KES 37.7 bn, reflecting increased provisioning and operational cost pressures.
Net Interest Income (NII) remained the primary driver of the Bank’s performance, expanding by 22.8% to KES 45.3 bn, from KES 36.9 bn in Q3’2024. This underscores the Bank’s ability to capitalize on the high interest-rate environment, with yields on government bonds and loans offering better returns compared to the previous year. On the other hand, Non-Funded Income (NFI) marginally declined by 0.8% to KES 22.1 bn, reflecting continued pressure on fees, trading income, and transactional revenues as customers remained sensitive to cost.
Operating expenses increased significantly, largely driven by a 31.9% rise in loan loss provisions to KES 7.4 bn, from KES 5.6 bn in Q3’2024. The elevated provisioning highlights the Bank’s prudential stance amid a deteriorating credit risk environment, especially in SME and consumer lending segments, which continue to face liquidity challenges.
The balance sheet registered steady growth, with total assets rising by 8.6% to KES 815.3 bn. The expansion was mainly attributable to increased investment in government securities, which grew by 20.7% to KES 255.4 bn, reflecting a strategic shift towards low-risk, high-yield assets. Customer deposits also rose by 6.7% to KES 548.6 bn, reaffirming the Bank’s strong retail and SACCO base, which continues to provide a stable and low-cost funding structure.
Profit Before Tax (PBT) grew by 12.1% to KES 30.0 bn, and in line with the strong performance, the Board recommended an interim dividend of KES 1.0 per share, translating to an annualized dividend yield of 9.0% and a dividend payout ratio of 27.2%.
Overall, Co-operative Bank continues to demonstrate strong operational efficiency, prudent risk management, and balance sheet resilience, positioning it for sustained growth heading into FY’2025.
