Kenyan Listed Banking Sector Quarterly Earnings and Operating Metrics
Recent Developments in the Kenyan Banking Sector.....
2. Regional Expansion through Mergers and Acquisitions:
Kenyan banks are looking at having an extensive regional reach. In Q3'2022, there were two acquisition by KCB Group Plc and Equity
Group Holdings as follows:
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On 2nd August 2022, KCB Group PLC, announced that it had entered into a final agreement with shareholders of Trust Merchant
Bank (TMB) to acquire an 85.0% stake in the Democratic Republic of Congo (DRC)- based lender, with an option to acquire the
remaining stake after two years. Key to note, the P/B multiple is higher than the 8-year acquisitions average P/B of 1.2x as well as
the current average P/B of the listed banking stocks of 1.0x. We estimate a payment of Kshs 15.7 bn by KCB at the trading
multiple of 1.5x given TMB's book value of FC 208.4 bn (Kshs 12.4 bn) as of 2020. For more information, please see our Cytonn
Weekly #31/2022
On 12th September 2022, Equity Group Holdings Plc through Equity Bank (Kenya) Limited, announced that it had entered into an
Assets and Liabilities purchase agreement with Spire Bank Limited for purchase of certain assets and liabilities. For more
information, please see our Cytonn Weekly #37/2022. However, the agreement has been frozen by the Employment and Labor
Relations Court following dispute over the fate of employees in Spire bank
Cytonn
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