The back and forth competition between two of the leading lenders in Kenya has seen a new winner, the Kenya Commercial Bank (KCB). KCB on Friday trading closed at KSH63 per share with an evaluation of KSH188 billion at the Nairobi Securities Exchange. KCB closed ahead of Equity Group that is now valued at KSH178.6 billion at a price of KSH48.25 per share.
KCB was trading at all-time high for the first time in seven months which was the opposite of the Equity group whose share price is falling. The events however haven’t come by surprise as Equity’s share has shed a considerable 6.7 % in value with KCB gaining 8.6% in the past on month.
The most recent evaluations at the bourse ranks KCB as the third largest company behind Safaricom and East Africa Breweries Limited which have market values of KSH637 and KSH257 billion respectively.
The recent market behavior of the companies can be attributed to the different book closure periods. Equity is trading ex-dividend having closed its register in March and announcing a Sh1.80 per share dividend. On the other hand, KCB is trading cum-dividend with the books set to close in May 11 with a Sh2 per share dividend.
Despite KCB taking the top slot in the valuation, Equity took the top spot in overall full-year profitability for 2014 raking a net profit of Sh17.15 billion which is a 27.8% growth compared to KCB’s Sh16.8 billion a 17.4% growth from previous year.
Equity announced its plan to expand at Sh200 billion shillings to an additional 5 countries to increase its operation base to 10 countries across Africa and in the process creating new shares. The created new shares however are expected to dilute the earnings per share but only for a while before the dilution is cancelled owing to the new revenue from the banks acquisitions. This can therefore be seen as a brighter future ahead for Equity Shareholders.
