JOINT PRESS RELEASE ON THE CO-OPERATIVE BANK INITIAL PUBLIC OFFER (IPO) AND LISTING AT THE NAIROBI STOCK EXCHANGE BY THE TRANSACTION ADVISOR, LEAD SPONSORING BROKER AND ISSUER
The Co-operative Bank of Kenya is the fourth largest bank in Kenya and has over the years made immense contribution to the Kenyan economy. To build on this growth the Bank has already announced plans to raise an estimated Kshs 10 billion in additional capital by way of an IPO through the Nairobi Stock Exchange. The funds raised will finance the Bank's mortgage products, Information and Communication Technology (ICT) infrastructure and expansion of the branch network.
The IPO Steering Committee has reviewed the issue at length and taken recognition that the listing comes at a time when there are some notable challenges facing the capital markets both locally and abroad, key among them being:
- A potential international global recession precipitated by the collapse of key financial institutions in the United States
- Current inflationary pressures impacted on partly by the international oil prices, and
- Current investor apathy in the post Safaricom IPO period.
- Co-operative Bank commendable business and operation restructuring over the last seven years with a full circle turnaround in its profitability from the hitherto years of loss making may perhaps be our economy's best documented case study of a corporate turnaround and there is great appetite by ordinary Kenyans for this share particularly considering the solid base of the 7million member Co-operative Movement.
- The Bank has continued to report excellent profitability with the profit before tax of Kshs 1.7 billion as at 30th June 2008, indicating that they will exceed the Kshs 3.3 billion target for the year 2008.
- The issue provides a guaranteed minimum allocation for the retail investors as a measure to encourage participation and provide equity to all investors.
- The issuer has put in place a highly automated IPO processing infrastructure particularly for efficient processing and timely payment of refunds.
- The prevailing circumstances also provide an opportunity for this IPO to rejuvenate the market and re-institute the market appeal by investors in the market,
- There is no feasible basis to determine how long the current bear in the market will prevail.
We invite all Kenyans to plan to purchase a piece of this Kenyan success story when the offer is formally launched.
Jimnah Mbaru
Chairman
Dyer and Blair Investment Bank
"The Transaction Advisor"
James Wangunyu
Chairman
Nairobi Stock Exchange and
SIB and FIB Consortium
"The Lead Sponsoring Brokers"
Gideon Muriuki
Managing Director
Co-op Bank of Kenya Ltd
"The Issuer"
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