Money Markets
Sacco Societies Regulatory Authority chief executive Carilus Ademba. PHOTO | FILE
By GEORGE NGIGI, gngigi@ke.nationmedia.com
In Summary
Saccos grew their assets by 14.2 per cent last year
with Stima and Unaitas the star performers driven by enrolment of new
members.
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Latest data from Sacco Societies Regulatory Authority
(Sasra) shows assets of the co-operatives stood at Sh335 billion in
December compared to Sh293 billion an year earlier.
The growth was driven by increase in membership to 3.3 million members from 2.97 million.
“This growth was mainly funded by member deposits, share capital and retained earnings,” said chief executive Carilus Ademba.
Stima Sacco nearly doubled its membership, to
26,468, which saw it rise to be the third largest union — after
teachers’ sacco Mwalimu and Harambee for civil servants — with an asset
base of Sh12.4 billion, an increase of Sh3 billion.
Unaitas, which has declared intention of converting
into a bank, increased its membership by 32,000 to 146,964 going up
three places to rank eighth with an asset base of Sh5.5 billion, from
Sh3.9 billion.
Savings made through the co-operatives stood at
Sh240 billion from Sh213 billion. Saccos loaned out Sh251 billion
compared to Sh221 billion a year earlier.
The volume of non-performing loans dropped to Sh8.9
billion from Sh11.7 billion. Amount set aside as provision for bad
loans, however, went up by Sh1 billion to Sh4.1 billion which the
authority attributed to improved compliance.
“Full compliance with loan losses provisioning
requirement should be attained by end of year and this implies strong
first line of defence against credit risks and consequently protection
to member deposits,” said Sasra in its annual report.
The co-operative societies increased their retained
earnings by a quarter to Sh20.5 billion underlining a change of
strategy among saccos that used to payout all their income in dividends.
The saccos reverted to retaining a portion of the
earnings to grow their capital levels so as to ensure compliance with
new regulatory requirements.
Sacco sector in Kenya was first regulated in 2009
following the formation of Sasra which ordered them to bolster their
capital levels and increase their loan provisioning.
Last month, the regulator ordered 30 savings and
credit cooperatives to stop collecting deposits from the public over
failure to comply with the statutory capital levels which left them with
back office operations that only allow lending cash to members based on
their savings.
There are 234 licensed deposit taking co-operatives
in Kenya. But there are more than 6,000 registered non-deposit taking
saccos, only 1,995 of which filed their audited financial statements
with the Commissioner for Cooperative Development as a legal
requirement.
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