Kenya-based Co-operative Bank (Co-op Bank) has announced the extension of its joint venture with South Sudan by three years.
The move will renew the parties’ co-ownership of Co-op Bank’s subsidiary in Juba, the country’s capital and largest city.
The Co-operative Bank of Kenya is a Kenyan financial bank. It is engaged in corporate and retail banking, investment and asset management services.
Gideon Muriuki was appointed group managing director and CEO in 2001. Between 2001 and 2020, he moved the bank from Ksh2.3 billion ($21 million) in losses to Ksh14.3 billion ($130.47 million) in profit before tax revenue.
The partnership with South Sudan was established in 2013 to replicate the bank’s business model, which makes it the primary banker to co-operative societies in Kenya.
“As a board, we decided to go as a joint venture with the government of South Sudan in order to also bring on board the local co-operative movement,” Muriuki said at the bank’s recent annual general meeting.
The government holds a 49-percent minority stake in the subsidiary, while the bank retains a controlling stake of 51 percent.
“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,” Muriuki said.
The plan initially entailed the government transferring its 49-percent stake to the country’s co-operative societies, but the political instability in the country stalled the process and extended the government’s right to hold the stake for another three years.
Nonetheless, the bank believes that the South Sudan “market will eventually stabilize.”