Co-op Bank Profit Rises 27% In 9M2026 On Loan Book Growth

Co-op Bank profit rises 27.20 percent in 9Months of FY2026 on loan book growth

Co-operative Bank of Kenya grew profit after tax 27.20 percent to Kshs27.43 billion in the nine months ended 30 September 2026, from Kshs21.56 billion a year earlier. Earnings per share rose 27.17 percent to Shs4.68 from Shs3.68. The board approved an interim dividend of Shs1.50 per share, up from Shs1.00 a year earlier.

Net interest income drove most of that growth, up 12.71 percent to Kshs51.03 billion, as interest income from loans and advances rose 9.42 percent while interest expense on customer deposits actually fell 7.08 percent. Non-interest income added further support, up 9.21 percent to Kshs24.14 billion, with fees and commissions on loans and advances the strongest contributor, up 22.41 percent. Loan loss provisions fell 34.24 percent to Kshs4.84 billion, a sign of improving asset quality that lifted profit further down the income statement.

Co-operative Bank of Kenya 9M2026 Snapshot (Group, Kshs millions, nine months ended 30 September)

Metric	9M2026	9M2025	YoY Change
Interest income, loans and advances	46,203.4	42,226.3	+9.42%
Interest income, government securities	22,978.3	22,216.1	+3.43%
Total interest income	72,681.7	67,925.4	+7.00%
Interest expense, customer deposits	(17,936.4)	(19,303.4)	-7.08%
Total interest expense	(21,649.7)	(22,647.6)	-4.41%
Net interest income	51,032.0	45,277.8	+12.71%
Total non-interest income	24,141.1	22,106.0	+9.21%
Total operating income	75,173.1	67,383.8	+11.56%
Loan loss provision	(4,839.0)	(7,358.4)	-34.24%
Staff costs	(16,961.7)	(15,053.2)	+12.68%
Other operating expenses	(17,917.3)	(15,305.4)	+17.07%
Total other operating expenses	(39,718.0)	(37,716.9)	+5.31%
Profit before tax and exceptional items	35,455.1	29,666.9	+19.51%
Share of profit of associate	452.9	359.0	+26.16%
Profit before tax	35,908.0	30,025.8	+19.59%
Tax charge	(8,477.8)	(8,461.1)	+0.20%
Profit after tax	27,430.2	21,564.7	+27.20%
Earnings per share (Shs)	4.68	3.68	+27.17%
Dividend per share (Shs)	1.50	1.00	+50.00%

Source: Co-operative Bank of Kenya Limited unaudited Group results for the nine months ended 30 September 2026.

Net interest margin widened to 5.62 percent of total assets from 5.55 percent. The cost-to-income ratio, which excludes loan loss provisions, actually worsened to 46.40 percent from 45.05 percent. Staff costs rose 12.68 percent to Kshs16.96 billion and other operating expenses rose 17.07 percent to Kshs17.92 billion, both faster than the 11.56 percent growth in total operating income. The improvement in profit after tax came mainly from the 34.24 percent fall in loan loss provisions and a lower effective tax rate, down to 23.61 percent from 28.18 percent, not from operating cost discipline.

Co-op Bank's own Kingdom Bank subsidiary stayed small relative to the Group, with profit after tax of Kshs872.96 million against the Group's Kshs27.43 billion, though it grew faster in percentage terms, up 65.48 percent from Kshs527.60 million a year earlier.

Total assets grew 11.31 percent to Kshs907.44 billion from Kshs815.27 billion a year earlier. Net loans and advances to customers grew faster, up 22.23 percent to Kshs496.89 billion, while customer deposits grew 15.39 percent to Kshs633.01 billion. Borrowed funds fell 13.24 percent to Kshs57.70 billion, and total shareholders' funds grew 9.22 percent to Kshs179.30 billion. Gross non-performing loans fell 9.20 percent to Kshs71.67 billion, even as the loan book itself grew sharply, pointing to improving loan quality instead of a larger loan book simply diluting the ratio.

Co-operative Bank of Kenya 9M2026 Key Ratios

Ratio	30 Sep 2026	30 Sep 2025
Net interest margin	5.62%	5.55%
Cost-to-income ratio	46.40%	45.05%
Net profit margin	36.49%	32.00%
Effective tax rate	23.61%	28.18%
Return on assets (ROA)	3.02%	2.65%
Return on equity (ROE)	15.30%	13.14%
Equity-to-assets ratio	19.76%	20.14%
Loans-to-deposits ratio	78.50%	74.11%
Gross NPLs to net loans and advances	14.42%	19.42%
Core capital to risk-weighted assets	20.00%	20.30%
Total capital to risk-weighted assets	21.30%	22.70%
Liquidity ratio	54.80%	61.00%

Source: ApexHub Insights calculations from Co-operative Bank of Kenya's unaudited Group results.

Returns improved across the board. ROA rose to 3.02 percent from 2.65 percent and ROE rose to 15.30 percent from 13.14 percent. The direction is consistent with the margin expansion and cost control already visible above. The loans-to-deposits ratio rose to 78.50 percent from 74.11 percent, in step with the loan book growing faster than deposits, still comfortably below a level that would signal funding strain.

Capital and liquidity both stayed well above the Central Bank of Kenya's statutory minimums. Core capital covered 20.00 percent of risk-weighted assets against a 10.5 percent minimum, and total capital covered 21.30 percent against a 14.5 percent minimum. The liquidity ratio stood at 54.80 percent against a 20.0 percent minimum, even after falling from 61.00 percent a year earlier as the loan book absorbed more of the balance sheet.

The board approved an interim dividend of Shs1.50 per share, up from Shs1.00 a year earlier, payable to shareholders on the register as at the close of business on 25 November 2026, with payment on or around 4 December 2026.

Bottom line for investors: Co-op Bank's 9M2026 results are strong on the lines that matter most, profit after tax up 27.20 percent, net interest margin wider, and non-performing loans falling in absolute terms even as the loan book expanded sharply. Cost-to-income actually worsened to 46.40 percent from 45.05 percent, so the profit growth leaned on lower loan loss provisions and a lower tax rate, not tighter cost control. Capital and liquidity buffers remain well clear of regulatory minimums, leaving room for continued loan growth, and the interim dividend of Shs1.50 per share, up 50 percent from a year earlier, signals board confidence in that trajectory. Going forward, the key concerns for investors is whether operating costs keep outpacing income, and whether loan growth at this pace keeps coinciding with falling non-performing loans.

Source: Co-operative Bank of Kenya Limited unaudited Group results for the nine months ended 30 September 2026.