The following market report was first published in the Business Daily.
14 top NSE billionaires investors with shares in Equity Bank, NIC Bank, DTB, CFC Stanbic and Barclays Bank are all set to earn about Sh. 1 billion in dividends, revealing the wealth creation machine that is the NSE.
Equity Group Holdings CEO James Mwangi is arguably the NSE dividend king, who is set to earn Sh433.2 million for his 6.5 per cent stake in Equity, which has reported the largest net profit of Sh17.1 billion. His 6.5 per cent interest in the bank includes a 1.62 per cent shareholding by his wife Jane Njuguna.
The Bablas are ranked second, with the family expecting a combined dividend of Sh163 million from their interests in KCB and Equity. The investors have been accumulating banking stocks at the NSE in the past few years, a move that has seen them rank among the largest individual investors in Kenya’s two largest lenders.
Mr Andrew Kimani is set to earn Sh162.6 million for his 2.4 per cent interest in Equity, which has proposed the largest absolute dividend payout of Sh6.6 billion.
KCB, which was previously the most profitable bank, will follow with a Sh6 billion payout, representing 36 per cent of the Sh16.8 billion net profit it made last year.
Meanwhile, Philip Ndegwa’s family is in line to pocketing Sh160 million from their ownership of a 25 per cent stake in NIC Bank, which will pay a total of Sh640 million in dividends. The dividend is particularly rewarding for NIC shareholders, including the Ndegwas, who last year pumped an extra Sh2.1 billion into the company to fund its growth plans.
The additional funding, in the form of a rights issue, was in effect a dilution of past returns including dividends. NIC is betting on the new funds to grow its earnings in the coming years and ultimately reward shareholders with higher dividends and capital gains.
Ms Leah Muguku, a relative of the late businessman Nelson Muguku, will receive Sh59.3 million for the 0.8 per cent stake she inherited in the bank. The Mugukus have sold the majority of the shares the patriarch held in the bank, earning billions of shilling from the divestitures. The original stake would now be earning more than Sh500 million in dividends — based on Equity’s current dividend policy — assuming it was left intact.
Mr Simon Thuo, another long-term investor in Equity Group, is slated to earn Sh47.6 million for his 0.7 per cent interest in the lender while Franklin Ndii will pocket Sh36 million for his 0.54 per cent interest in Equity ahead of the bank’s chairman Peter Munga who stands to get Sh27.9 million for his 0.4 per cent per cent stake. Mr Munga has significantly reduced his ownership in the bank, earning billions of shillings in the process.
Benson Wairegi, the chief executive of insurance firm Britam, is enroute to pocketing Sh16.3 million for the 0.25 per cent stake he holds in Equity. He will be followed by Mr James Kimani who is scheduled to get Sh15.7 million for his 0.24 per cent stake.
NSE Billionaire investor Jeremiah Kiereini will earn Sh12.2 million for his 0.5 per cent interest in CFC Stanbic Holdings. Mr Baloobhai Patel, another NSE billionaire investor, is expecting Sh9.8 million from his minority interests in Barclays and DTB. Mr Patel has the bulk of his net worth — in excess of Sh3 billion — outside banking stocks.
Mr Duncan Ndegwa will receive Sh5.5 million for his 0.8 per cent interest in NIC Bank while billionaire investor Amin Nanji Juma is slated to earn Sh5.3 million for his 0.9 per cent stake in DTB where he is the single largest individual investor.
