Capital Markets

NBK owners to receive Sh6.2bn KCB shares on Friday

 Kencom branch
Customers at a KCB branch in Nairobi. FILE PHOTO | NMG 

KCB Group #ticker:KCB will Friday allot 147.3 million new shares worth Sh6.2 billion to former owners of National Bank of Kenya (NBK) which it recently acquired in an all-stock transaction.

The new shares, most of which will be taken up by the National Treasury and National Social Security Fund (NSSF), will be freely tradeable on the Nairobi Securities Exchange.

“We will list the new shares on October 4,” KCB said in a response to queries from Business Daily.

The move comes amid a short-term rally in KCB’s share whose price has gained to the current level of Sh42 from lows of Sh38 last month.

The new shares will take on the prevailing market price and will be valued on the NSE at about Sh6.2 billion in aggregate. This will in turn lift KCB’s total market capitalisation to Sh135.6 billion from the previous Sh129.3 billion.


The volume of shares of the country’s biggest bank also rises to 3.2 billion units from the previous 3.06 billion units, marking a rare expansion of the stock base.

Unlike Equity Group #ticker:EQTY, KCB has been more cautious in using its shares as currency in funding acquisitions. The merger was completed by swapping one KCB share for 10 NBK shares. KCB says it plans to fully integrate NBK within two years.

The deals allows former NBK owners, who had gone for years without dividends and suffered major paper losses, to ride the coattails of the country’s biggest bank by assets and absolute profits.

KCB said it will reorganise NBK’s board of directors during the integration period, indicating its focus on cleaning up the bank’s top leadership.