Companies

Co-op Bank owners give the green light for Ethiopia entry

gm

Co-operative Bank of Kenya chief executive Gideon Muriuki. PHOTO | SALATON NJAU

Shareholders of the Co-operative Bank of Kenya have backed the lender’s plans to enter the Ethiopian market.

The lender wants to enter the market in a joint venture with Ethiopia’s cooperative movement in a deal similar to its South Sudan business in which the government has a stake.

Chief executive Gideon Muriuki said the entry would enable Co-op Bank to capitalise on Ethiopia’s fast-growing unbanked population.

“We are talking about a population of 90 million people and this looks very promising for us,” Mr Muriuki told shareholders at the Bank’s Annual General Meeting (AGM) last Friday.

Less than 15 per cent of Ethiopians have access to a bank account. Most banks are State-owned. The country has been closed from foreign banks seeking to venture into its fast growing financial services market.

Besides Ethiopia, Mr Muriuki said the lender is eyeing a presence in Rwanda, Uganda and Tanzania in the next five years.

READ: Co-operative Bank overtakes StanChart in the profitability ranks

Shareholders approved an 80 cents per share dividend, a 60 per cent increase in the pay-out level compared to 50 cents per share paid out in 2015.

The AGM re-elected Messrs Macloud Malonza, Richard Kimanthi and Benedict Simiyu for another term of three years after the majority and strategic shareholder Co-opholdings Co-operative Society nominated them for re-election.

The AGM also re-elected Mr Stanley Muchiri for another term.

Co-op Bank group is the third-largest by assets in Kenya and runs four subsidiaries namely; Kingdom Securities, Co-opTrust Investment Services, Co-operative Consultancy Services (K) and Co-operative Bank of South Sudan.

The bank’s footprint across Kenya and the region includes 140 branches plus two in South Sudan with over 8,000 Co-op Kwa Jirani agents serving six million customers.