The Co-operative Bank of Kenya is the third largest financial services provider in Kenya (by market value) and it has total assets to the tune of Ksh 144 billion (US$1.76 billion) making it a success story of the Kenyan co-operative movement. Established in 1965 as a co-operative society it has grown consistently over the years and this growth is bound to continue.
The Co-operative Bank of Kenya is planning to invest Sh3.8 billion in establishing a subsidiary in South Sudan and also hopes to open 35 new branches in Kenya this year in an expansion drive it expects to drastically grow its profit margins.
The bank will be spending at least 860 million to purchase a 70% stake in a bank to be opened in Juba with the South Sudan government owning the remaining 30%. This follows the trend set by KCB and Equity who have already established several subsidiaries in the greater East Africa region. Eventually the South Sudan government is expected to transfer its stake to local co-operative societies. This will take a few years.
In the recent past, Kenyan banks’ growth has been somewhat attributed to their South Sudan subsidiaries. This market accounted for 80% of profits generated by KCB’s regional subsidiaries and all of Equity Bank’s earnings outside the country. Family Bank is also expected to venture into the South Sudan market this year.