Thy Kingdom Falls; Co-operative Bank in a Brokerage Multi Million Shilling Loss

Friday, 19 March 2010 03:00

Written by theNairobian

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Coming from the highly publicized take over of the stock brokerage firm, Bob Mathews Stock Brokers Ltd in June 2009, to form Kingdom Securities, Cooperative Bank of Kenya has had a not so pleasant introduction into the kingdom of Nairobi Stock Exchange as they announced a Kenya Shillings loss of 19 million for the financial year ending 31st December 2009.

This involved only 6 months of trading and the financial results were released in compliance with the Regulator Capital Markets Authority (CMA) requirement that market intermediaries do release their results within 3 months after end of the year.

The designated cause of all those millions going way south was the usual suspect: huge establishment costs accrued after its inception in June 2009 leading to squeezed revenues. The revenue that, according to Kingdom Securities financial statement released on the 18th March, 2010, jumped by 95% from the previous year’s Kshs. 12.95 million to Kshs. 25.37 million.

Which revenues were hard done by a superior 122% growth in expenditure from the previous year’s Kshs. 20.31 million to Kshs. 45.04 million. This expenditure resulted in among others a claimed largest retail agency network of over 250 outlets comprising 79 Co-operative Bank branches countrywide; 124 co-operative societies and 50 independent agents.

Kingdom Securities’ Managing Director, Mr Geoffrey Odundo, speaking during the official launch of the company’s new banking premises in Nairobi yesterday said offered the known fact that the company has been in operation for only six months and  this year would be the company’s first year in operation and consequently things are bound to improve in this particular stokerage kingdom.

Kingdom Securities proprietor, Co-operative Bank of Kenya on the other hand made a pre-tax profit of Kshs. 3.74 billion last year, a growth of 11.2%.

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