I&M Bank #ticker:I&M has joined the class of large banks after its market share grew by 0.54 percentage points, driven by new business from its acquisition of Giro Bank concluded in 2017.
Its market share grew to 5.32 percent to rank ninth and surpass the five per cent mark used by the Central Bank of Kenya (CBK) to classify banks as large industry players.
The bank becomes the latest to join the league of large institutions after Diamond Trust Bank (DTB) #ticker:DTK joined the group in 2016.
Kenyan commercial banks are classified into three peer groups using a weighted composite index that comprises net assets, customer deposits, capital and reserves, number of deposit accounts and number of loan accounts.
A bank with a weighted composite index of five percent and above is classified as a large bank. A medium bank has a weighted composite index of between one percent and five percent while a small bank has a weighted composite index of less than one percent.
The realignment saw banks in large peer group increase their combined market share from 65.98 percent in December 2017 to 70.28 percent in December 2018.
“This was due to movement of I&M Bank Ltd from medium peer group in 2017…in December 2018 after the merger with Giro Commercial Bank Ltd,” said the CBK’s full-year Supervision Report.
The report shows the combined market share of banks in the medium peer group decreased from 26.10 percent in December 2017 to 21.22 percent in December 2018.
This came as Bank of Africa Ltd moved from medium peer group in 2017 to small peer group in 2018 as a result of decreased net assets.
KCB #ticker:KCB cemented its position as the largest lender in the country after retaining its market share of 14.1 per cent, a position set to change on National Bank takeover. The report findings also do not capture the latest merger of Commercial Bank of Africa and NIC Bank #ticker:NIC.
In market size leadership, KCB is followed by Equity and Cooperative Bank of Kenya at 9.9 percent and 9.3 percent respectively.