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Monday, May 25, 2020

Kenyatta family now own Sh. 6.6 billion stake in NCBA bank

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Kenyatta Family Business Empire:The Kenyatta family now own a stake worth over Sh. 6.6 billion in the merged NIC Group and CBA Group banks.

According to a report that appeared in the Business Daily on Wednesday, the “combined business of the two banks, which is now known as NCBA, climbed three places to rank sixth among the 10 banks listed on the Nairobi Securities Exchange (NSE) with a market valuation of Sh. 50.3 billion after listing the additional shares.”

Here is the report on the new banking Kenyatta family business empire:

“The additional 793.8 million new shares belonged to owners of CBA Group including members of the Kenyatta family and billionaire businessman Naushad Merali with listing status opening the owners of the additional stock to public scrutiny. The Kenyattas control about 13.2 percent of the new entity, a level of ownership that slightly surpasses the 11.75 percent stake that the family of the late Phillip Ndegwa owns in the merged business.

The 13.2 percent is valued at Sh. 6.6 billion based on NCBA’s closing price of Sh. 33.65, up 5.3 percent on Friday’s close price of Sh. 31.95. This valued Mr Merali’s 2.9 percent stake in the merged entity at Sh. 1.45 billion with the listing of the new shares offering owners of CBA Group a platform to trade in their stocks. The transaction happened though a share swap between the two banks, with current NIC Group shareholders owning 47 percent of the merged entity and CBA shareholders, including the Kenyatta family, owning 53 percent of the merged entity.

NIC Group has remained listed with the transfer of the CBA unquoted shares into the merged entity. The new shares helped NCBA overtake Stanbic Holdings, I&M Holdings and DTB Group whose market value stood at Sh39.3 billion, Sh. 37.9 billion and Sh. 32.1 billion respectively. The additional stocks, combined with a rally in NCBA’s share price, more than doubled the bank’s market value to Sh. 50.3 billion from Sh. 22.4 billion on Friday last week when it was ranked ninth.

The lender’s volume of outstanding shares has jumped to 1.49 billion units from the previous 703.9 million units. The merger also lifted NCBA’s combined assets to Sh. 476 billion based on June financial reports, ranking it third by this measure after KCB and Equity, which hold Sh. 859 billion and Sh. 638 billion respectively. Equity remains the highest-valued bank, closing yesterday with a market capitalization of Sh. 146.9 billion ahead of KCB (Sh. 139.7 billion) and Co-op Bank (Sh. 73.9 billion). StanChart’s stood at Sh. 67.4 billion, followed by Barclays at Sh. 61.9 billion. NCBA is expected to boost its profitability going forward by cutting costs across its regional operations. Before the merger, NIC and CBA operated independent banking, stock brokerage and other businesses in Kenya and other countries, including Tanzania.”

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