All top 5 Kenyan banks have announced their results.
And with it comes a new king in town. Equity Bank.
Equity Bank is first on the list when ranked on Profit Before Tax (PBT) with a PBT of Kshs. 2.89 Billion. KCB takes second place with Kshs. 2.51 Billion.
Barclays Bank of Kenya slips to third with a PBT of Kshs. 2.404 Billion. Following close behind is Standard Chartered Bank of Kenya which posted a PBT of Kshs. 2.314 Billion.
Rounding out the top 5 is The Co-operative Bank of Kenya which registered a 57.4% increase in PBT from 1.3 Billion to 2.04 Billion.
It seems that the Fat Lady has finally sung and the dominance of colonial banks has now been broken. It is very unlikely that either of Barclays or SCBK will return to the top of the perch any time soon.
There simply isn’t enough Custodial Businesses to sell. The curtain is closed.
Some may argue that Barclays and Standard Chartered are restricted by their parent companies from expanding into other countries. But that is not for investors to care. Investors only care about earning the most from their principal at a reasonable risk.
Barclays and SCBK do not (will not) offer that as they will miss out on massive profits that will be reaped from regional expansion. Equity Bank and KCB have already shown what subsidiaries in the profit zone can do to the bottom line.
It is also necessary to have a buffer when the home country is not doing as well.
With that, the following is a comparative analysis of Kenya’s Top 5 Banks using the 2010 and 2011 1st Quarters (1 January to 31st March)
TABLE SHOWING ABSOLUTE VALUES AS AT 31ST MARCH 2011
*The Dividend Yields and P/E Ratios were calculated using stock prices as at close of trading at the NSE on Friday 20th May 2011
*Amounts are in Kenya Shillings
EQUITY BANK GROUP | KENYA COMMERCIAL BANK GROUP | BARCLAYS BANK OF KENYA | STANDARD CHARTERED BANK OF KENYA | THE CO-OPERATIVE BANK OF KENYA | |
TOTAL ASSETS | 153.5 BILLION | 271 BILLION | 178.9 BILLION | 145.2 BILLION | 169.5 BILLION |
NET LOANS AND ADVANCES | 86.2 BILLION | 155 BILLION | 90.75 BILLION | 68.5 BILLION | 91.5 BILLION |
CUSTOMER DEPOSITS | 108.5 BILLION | 209.2 BILLION | 129.1 BILLION | 101.5 BILLION | 136 BILLION |
LOAN:DEPOSIT RATIO | 79.4% | 74.1% | 70.27% | 67.53% | 67.28% |
TOTAL INTEREST INCOME | 4 BILLION | 5.7 BILLION | 3.86 BILLION | 2.45 BILLION | 3.46 BILLION |
TOTAL INTEREST EXPENSE | 424.3 MILLION | 597.4 MILLION | 181 MILLION | 242.6 MILLION | 605.8 MILLION |
NET INTEREST INCOME | 3.6 BILLION | 5.1 BILLION | 3.68 BILLION | 2.21 BILLION | 2.85 BILLION |
TOTAL OPERATING INCOME | 6.5 BILLION | 7.9 BILLION | 6.19 BILLION | 4.11 BILLION | 4.58 BILLION |
TOTAL OPERATING EXPENSE | 3.65 BILLION | 5.4 BILLION | 3.79 BILLION | 1.8 BILLION | 2.54 BILLION |
COST:INCOME RATIO | 56% | 68.4% | 61.23% | 43.69% | 55.46% |
NET NON PERFORMING LOANS | 1.85 BILLION | 5.7 BILLION | 1.15 BILLION | 387.6 MILLION | 2.65 BILLION |
PROFIT BEFORE TAX | 2.89 BILLION | 2.5 BILLION | 2.4 BILLION | 2.31 BILLION | 2.05 BILLION |
PROFIT AFTER TAX | 2.34 BILLION | 1.77 BILLION | 1.53 BILLION | 1.64 BILLION | 1.64 BILLION |
DIVIDEND YIELD | 3.2% | 4.9% | 8.26% | 5.34% | 2.28% |
PRICE/EARNINGS RATIO | 12.95 | 9.44 | 8.46 | 13.51 | 13.4 |
TABLE SHOWING Q1 2011 VS Q1 2010 PERCENTAGE CHANGE
*The colour red has been used to indicate measures which were down. The colour green has been used to indicate measures which were up.
EQUITY BANK GROUP | KENYA COMMERCIAL BANK GROUP | BARCLAYS BANK OF KENYA | STANDARD CHARTERED BANK OF KENYA | THE CO-OPERATIVE BANK OF KENYA | |
TOTAL ASSETS | +38.8% | +22.78% | +5.87% | +17% | +39.18% |
NET LOANS AND ADVANCES | +30.28% | +23% | -1.73% | +41.72% | +40.7% |
CUSTOMER DEPOSITS | +43.18% | +12.9% | +5.07% | +10.4% | +35.9% |
LOAN:DEPOSIT RATIO | -7.88% | -6.2% | -4.85% | +14.92% | -0.03% |
TOTAL INTEREST INCOME | +27.9% | +12.7% | -11.55% | -4% | +27.43% |
TOTAL INTEREST EXPENSE | -17.7% | -49.9% | -65.4% | -52% | -20.8% |
NET INTEREST INCOME | +38.9% | +32% | -4.2% | +7.9% | +46.4% |
TOTAL OPERATING INCOME | +40.1% | +21.86% | +2.02% | +21.5% | +41.1% |
TOTAL OPERATING EXPENSE | +21.9% | +17.79% | -6.86% | +32.27% | +30.23% |
COST:INCOME RATIO | -8.33% | -2.3% | -5.77% | +5.02% | -4.7% |
NET NON PERFORMING LOANS | -28.9% | -12.6% | -56.78% | -36.25% | -35.3% |
PROFIT BEFORE TAX | +72.8% | +31.6% | +20.05% | +11.54% | +57.4% |
PROFIT AFTER TAX | +86.8% | +33.3% | +11.54% | +13.88% | +57.7% |
From the tables, it can be seen that KCB leads on most of the metrics including Total Assets, Interest Incomes and Total Operating Income. This dominance is however hugely negated by a high Cost:Income Ratio and huge net non-performing loans (perhaps a reminder of its past?). This led to KCB being overtaken by Equity on the profits front.
Barclays and Standard Chartered registered declines in Total Interest Incomes, while the other 3 banks posted double digit growth.
Cost:Income Ratios were down for all banks except for Standard Chartered.
Net non-performing loans were down for all the 5 banks.
All the banks also recorded double digit growth in profits.
Banking enthusiasts are now eagerly waiting to see if the H1 Results will be equally as brilliant or will be dampened by the recent surge in inflation which threatens to reduce consumers’ disposable incomes
Please use colors that one can 'see' & not green on dark grey!
ReplyDeleteOtherwise nice job! Keep up the good work.
Good work
ReplyDeletecoldtusker, thanks. I changed the colour. Hope its clear now
ReplyDeleteAnonymous, asante sana
ReplyDeleteThanks for the comparison!
ReplyDeleteThat's a nice chart
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