Absa, NCBA pass Stanchart in valueFriday January 20 2023
NCBA Group and Absa Bank Kenya have risen to overtake Standard Chartered Bank Kenya in the market capitalisation ranking of Kenya’s listed lenders.
NCBA’s market value had grown to Sh64.5 billion as of Tuesday, making it the fifth-largest bank.
The institution had an implied value of Sh44.8 billion on September 30, 2019, when it was ranked sixth.
NCBA was created on that day following the merger of the former CBA Group and NIC Group –which was listed on the bourse and took on the new name after the business combination.
Read: What Absa market index says about bourse
The merger saw NCBA issue an additional 793.8 million shares to the former owners of CBA Group who took a combined 53 percent stake in the Nairobi Securities Exchange-listed bank.
Absa Bank’s market capitalisation also grew to Sh66.5 billion as of Tuesday, making it the fourth largest bank.
The lender was worth Sh59.7 billion on September 30, 2019, when it was ranked fifth after Stanchart whose market value stood at Sh68.6 billion.
Stanchart’s market capitalisation has since declined to Sh58.6 billion as of Tuesday, ranking it sixth.
The other listed banks maintained their positions despite posting a mix of growth and decline in shareholder wealth.
Equity Group, which has traditionally traded at the highest premium, remains the most valuable bank with a market capitalisation of Sh174.3 billion.
The bank’s market value also grew by the largest amount of Sh33 billion from Sh141.3 billion on September 30, 2019.
Equity overtook KCB in absolute profits in the year ended December 2020, extending its leadership in various measures including assets.
NCBA had the second-largest expansion in shareholder wealth at Sh19.7 billion.
This reflects the impact of the additional shares issued in the merger, the bank’s improved profitability and the higher dividend payout that has seen its share price rally the most among the listed lenders in recent months.
The stock surged to a 52-week high of Sh40.2 on Tuesday last week before easing to close at Sh39.2 this Tuesday.
Read: Inside meteoric rise of NCBA to a tier one lender
NCBA nearly doubled its net income to Sh12.8 billion in the nine months that ended September.
The bank has also announced that it will be distributing up to half of its profits going forward, signalling more generous dividends than was the case before.
Absa is third, expanding its shareholder wealth by Sh6.7 billion over the review period.
The bank posted a 30 per cent jump in net profit to Sh10.7 billion in the nine months that ended September on the back of higher income from lending.
Absa, which completed its expensive separation from its former parent firm Barclays Plc, has also joined other listed banks in reinstating dividends whose payout became erratic in the wake of the Covid-19 pandemic.
Stanbic Holdings saw its market capitalisation rise by Sh6.3 billion to Sh44.2 billion but kept its position as the seventh most valuable bank.
Co-op Bank added Sh2.3 billion to shareholder wealth to Sh72.1 billion, retaining its third rank.