The Co-operative Bank has extended its joint venture with the government of South Sudan by three more years. The joint venture has allowed Co-op Bank to run a subsidiary, Co-op Bank South Sudan, in South Sudan.
The subsidiary is also known as the Co-operative Bank of South Sudan. It is a unique joint venture partnership with Government of South Sudan, in which Co-op Bank holds a 51 per cent stake and the Government of South Sudan a 49 per cent.
In the first half of 2021, Co-op Bank South Sudan returned a monetary loss of Sh. 290 million. This was largely attributable to hyperinflation accounting due to currency devaluation of the South Sudanese pound.
Co-op Bank chief executive officer Dr. Gideon Muriuki expressed optimism that the market in South Sudan will stabilize. “We believe that market will eventually stabilize,” said Dr. Muriuki. He explained that Co-op Bank had decided to venture into the South Sudan market in 2013 with the aim of bringing on board the South Sudan co-operative movement.
“The 49 percent shareholding held by the government of South Sudan was to be transferred to the co-operative societies in South Sudan but the peace process, the performance of that economy has taken time to stabilize and we have extended that period by another three or so years,” said Dr. Muriuki.
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The extension of the joint venture came as the bank recorded profit growth for the first half of the 2021 financial year. According to the bank’s financial results, the bank realized half year net profit of Sh. 7.4 billion. This came as the bank recorded a gross profit of Sh. 10.5 billion from the Sh. 9.6 billion recorded in the second quarter of 2020. The net profit realized by the bank was a jump from the 7.2 billion reported in second quarter of 2020.
During the period under review, the bank’s total assets grew by Sh. 59.1 billion to Sh. 573 billion compared to Sh. 513.9 billion in the same period last year. Net loans and advances grew by Sh. 29 billion from Sh. 272.2 billion to Sh. 301.2 billion.
