Co-operative Bank of Kenya has announced a historic first-ever interim dividend for its shareholders, following a robust financial performance that saw its net profit increase by 12.3% to KSh 21.6 billion for the nine months ending September 30, 2025. This marks a significant strategic shift for the Nairobi Securities Exchange (NSE)-listed lender, which has exclusively issued a final annual dividend since its public listing in 2008.

The Board of Directors, in a statement released on Thursday, November 13, 2025, approved a dividend of KSh 1.00 per ordinary share. The total payout, amounting to KSh 5.86 billion, will be disbursed on or around December 4, 2025, to shareholders on the register as of the close of business on November 26, 2025. Group Managing Director and CEO, Dr. Gideon Muriuki, stated that the move underscores management's confidence in the bank's strong performance and positive outlook.

KEY FINANCIAL HIGHLIGHTS

The impressive earnings were up from KSh 19.2 billion recorded during the same period in 2024. The bank's profit before tax also saw a significant rise of 12.1%, reaching KSh 30 billion. This performance was largely driven by a substantial 22.8% growth in net interest income, which climbed to KSh 45.3 billion from KSh 36.87 billion the previous year. Total operating income consequently grew by 13.9% to KSh 67.4 billion.

Analysis of the bank's balance sheet reveals sustained growth. Total assets expanded by 8.6% year-on-year to KSh 815.3 billion. This was supported by a 6.7% increase in customer deposits, which reached KSh 548.6 billion, and a 6.6% growth in the net loan book to KSh 406.5 billion. Shareholders' funds saw a remarkable 24.5% surge to KSh 164.2 billion, bolstered by KSh 12.5 billion in retained earnings.

ANALYSIS AND REGIONAL CONTEXT

The decision to issue an interim dividend is a strong indicator of the bank's solid capital base and liquidity position. For the Kenyan investor, this move signals a potential for more regular returns from a blue-chip company, enhancing its attractiveness on the NSE. The bank's largest shareholder, Co-op Holdings Co-operative Society Limited, which holds a 64.56% stake, is set to receive the largest portion of this payout, amounting to approximately KSh 3.78 billion.

The bank's performance also reflects its successful operational efficiency strategies under its “Soaring Eagle” Transformation Agenda. The cost-to-income ratio improved to 45.1%, a significant improvement from 59% in 2014, indicating better cost management. Furthermore, over 90% of the bank's transactions are now conducted through digital channels, highlighting a successful migration to more efficient platforms.

The Group's subsidiaries have also shown strong performance. Kingdom Bank, its subsidiary, recorded a profit before tax of KSh 820.2 million. In the wider East African region, the Co-operative Bank of South Sudan returned to profitability, contributing KSh 259.3 million in pre-tax earnings, demonstrating a positive turnaround amid improving economic stability in that market. This regional performance underscores the bank's successful expansion and its growing footprint beyond Kenya.

Despite the positive results, the bank increased its loan loss provisions by 31.9% to KSh 7.4 billion, a prudent measure that suggests a cautious approach to credit risk in the current economic environment. This move, while impacting short-term profit figures, strengthens the bank's resilience against potential defaults. The announcement positively impacted the bank's stock, which saw its share price rise on the NSE following the news.