Co-op Bank Records Sh23.1bn Profit in H1 2026 as Lending Grows 18.1%

By Maurice Momanyi

Co-operative Bank of Kenya has posted its strongest-ever half-year financial performance, with profit before tax rising 17.3 per cent to Sh23.1 billion for the six months ended June 30, 2026.

The lender’s profit before tax increased from Sh19.7 billion recorded in the first half of 2025, while profit after tax climbed 28 per cent to Sh18 billion from Sh14.1 billion.

The results, released on Wednesday, August 12, 2026, come as the bank continues to implement its 2025-2029 ‘Good to Great Strategy’ and the Soaring Eagle Transformation Agenda. The bank described the performance as its “best-ever half-year performance.”

Co-operative Bank’s operating income rose 12.5 per cent to Sh48.9 billion, supported by growth in both interest and non-funded income. Net interest income increased 13 per cent to Sh33.2 billion during the period.

The Group’s balance sheet also expanded, although at a more measured pace than its loan book. Total assets grew 7.1 per cent to Sh869.5 billion, compared with Sh811.9 billion a year earlier.

Customer deposits increased 11.2 per cent to Sh623.2 billion, providing a stronger funding base for the bank’s lending business. Net loans and advances, meanwhile, grew by 18.1 per cent to Sh462.2 billion.

The bank’s government securities portfolio increased by seven per cent to Sh271.6 billion, while borrowed funds declined by 11.4 per cent to Sh58.2 billion, reflecting efforts to optimise the Group’s funding mix.

Operating expenses increased by 9.2 per cent, with the cost-to-income ratio before provisions standing at 46 per cent. The slower growth in expenses compared with operating income points to continued gains in operational efficiency.

Co-operative Bank also reported a significant improvement in the quality of its loan book despite the strong expansion in lending.

The non-performing loan ratio declined to 13.9 per cent from 17.2 per cent in the first half of 2025.

At the same time, IFRS loan-loss coverage improved to 80.7 per cent from 69.9 per cent, while the cost of risk fell to 1.8 per cent from 2.4 per cent.

The improvement in these indicators suggests that the stronger loan growth was accompanied by tighter credit-risk management.

The bank continued to deepen its alternative distribution channels during the period, with 16,105 Co-op Kwa Jirani agents, 609 ATMs and cash deposit machines, a 24-hour contact centre and 223 branches across Kenya, South Sudan and through Kingdom Bank.

Deposits mobilised through agency banking increased 8.7 per cent to Sh92.5 billion from Sh85.1 billion in the corresponding period last year.

The Group’s diaspora banking customer base also surpassed 23,000, highlighting the continued expansion of its services to Kenyans living and working outside the country.

Staff numbers increased to 6,591, representing an additional 741 employees compared with the first half of 2025.

The strong results come against the backdrop of Co-operative Bank’s continued execution of its 2025-2029 strategic plan, which is built around the “Good to Great” strategy and supported by the Soaring Eagle transformation agenda.

The bank’s first-quarter results had already pointed to strong momentum, with profit before tax rising 18.1 per cent to Sh11.37 billion and profit after tax increasing 21.3 per cent to Sh8.41 billion. Total assets at the end of March stood at Sh884.6 billion, while deposits had crossed the Sh600 billion mark.

The H1 results therefore demonstrate that the bank maintained its profitability momentum into the second quarter, while significantly expanding lending.

The performance positions Co-operative Bank among Kenya’s leading lenders as it enters the second half of 2026, with growth in deposits and lending providing a platform for further expansion.

The combination of rising operating income, improved asset quality, stronger loan-loss coverage and disciplined expense growth points to continued focus on profitable and sustainable growth.

The bank’s management is expected to provide further details on the performance and outlook during its investor briefing, including the contribution of its subsidiaries, digital banking, MSME financing and the wider cooperative ecosystem.