* Pretax profits up 54 percent to 4.38 bln shillings
* Net loans up 33 percent
(Adds quote, analysts)
By Helen Nyambura-Mwaura and Wangui Kanina
NAIROBI, Nov 11 (Reuters) - Kenya's Co-operative Bank posted a 54 percent rise in nine-month pretax profit, boosted by a rise in income from fees and commissions as it attracted more customers.
Ranked Kenya's fourth-largest bank by assets, Co-operative has this year acquired a 21 percent stake in insurance provider CIC and has a 70 percent stake in a bank subsidiary in South Sudan.
Analysts said the rise in pretax profit to 4.38 billion shillings ($54.2 million) exceeded market expectations.
Net interest income rose by 30 percent to 6.37 billion shillings. The bank's net loan book rose by a third to 80.5 billion shillings and provisions for bad loans went up 7 percent to 701 million shillings.
Co-operative Managing Director Gideon Muriuki said the number of customers had risen to 1.5 million from 1 million within the last year.
Co-operative's growth trumps that of other Kenyan banks that have so far announced nine-month results.
KCB, Kenya's biggest bank by assets, reported a 23 percent rise in pretax earnings, while Equity Bank posted a 53 percent rise. "This is excellent, it beats expectations," said George Bodo, an analyst at Genghis Capital, referring to Co-operative's results. "Our target (share) price is 26 shillings." Co-operative shares have risen 122 percent so far this year and were trading at 20.25 shillings at 0847 GMT.
"The valuation now is fairly priced," said Einstein Kihanda, head of fund management at Sanlam Investment Management.
Co-operative said deposits were up more than half to 117.4 billion shillings and non-funded income rose 55 percent to 5.17 billion, mainly from foreign exchange income, letters of credit and mobile banking.
The group's stockbrokerage division turned around with a profit of 29.2 million shillings from a loss of 9.5 million in September 2009.
"This will clearly be a cash cow for us. The demand is there and the clientele is there," Muriuki said.
(Editing by Richard Lough and Erica Billingham)
($1=80.75 Kenyan Shilling)