Nigeria’s Big Banks Market Value Climbs to N4.81 Trillion
Nigeria’s Tier-1 banks combined market value jumped above N4.81 trillion in the stock market due to buying interest in Zenith, UBA, and FBN Holdings Plc, according to data from the Nigerian Exchange.
On the sell side, investors reduced interest in Access Holdings and GTCO Plc, with both closing the week negative, in contrast to equities market direction. With earnings releases, analysts forecasted that investors would start betting on the earnings prospects of big banks that are yet to release their financials.
MarketForces Africa gathered that banks with stronger earnings per share, and returns on equities would most likely attract investors’ attention in the coming weeks despite issues around windfall tax. Apart from the better fundamentals of these big banks, sentiment is another thing that can drive their share prices higher.
“There are other reasons why investors acquire company shares—for control and for share and capital gain—it depends on the motive.”.
Based on their results, GTCO led the industry in terms of return on equity (ROE) of 36.53%, followed by UBA (29.93%), Zenith (29.13%), Access (28.34%), and FBNH (18.23%).
Data from the Nigerian Exchange showed that the banking index surged by +1.05% due to the latest rally that followed the second quarter of 2024 economic growth record. Three out of the five big banks in the tier-1 category ended the week with positive price movement. This lifted their combined market value upward from N4.7 trillion, according to data tracked by MarketForces Africa.
With mixed activities seen from both the sell and buy side equities traders in the Nigerian, the banking index gained 1.05% week on week due to buying interest in three banks, and selloffs in two.
The largest bank by total assets, Access Holdings Plc plunged due to sell pressure partly due to delay in group earnings released for the first half of 2024. The tempest of sell side trading activities on the banking index was moderate as other banks gained offset losses incurred by GTCO and Access Bank Plc.
Negative price movement in these two banks weren’t sharp enough to shift their combined market value lower significantly. In terms of valuation, GTCO, Zenith Bank Plc and UBA rank stronger, while FBNH Access Plc remain the most volatile stock, trading at a steep discount from its peers.
Data from the local bourse suggests that the tier-1 lenders are trading at a steep discount to their respective 52-week high stock market performance amidst expectation of their earnings release.
Market price to 52 week high discount gets wider for FBN Holdings ahead of its annual general meetings. GTCO Plc still ranked ahead of its rival lenders in terms of market value.
The group ended trading session on Friday at N1.339 trillion, down from N1.342 trillion after it market price slumped to N45.5 from N45.6 at the beginning of the week. GTCO is trading at 15.6626% discount to its 52-week high at the close of the trading session on Friday amidst 9 billion shares offered for subscription at N44.50.
Zenith Bank Plc market value climbed to N1.200 trillion from N1.189 trillion last week due to a positive price movement which shifted its price to N38.25 from N37.90 per share in the local bourse.
The bank share is now trading at a 19.21% discount to its 52-week high amidst N290 billion in capital raise via rights and public offers. UBA Plc’s market value increased to N785 billion from in the equities market from N766.067 billion in the previous week as price rose by 50 kobo.
The Pan African lender opened the week at N22.45 per share but ended at N22.95 on Friday. UBA is trading at 32.5% discount to a 52-week high as of Friday’s close.
Access Holdings fell t N675 billion in the equities market from N706 billion as the top lender popularity declined among investors. Its share price declined to N19 from N19.95 at the beginning of the week.
At the current stock market price, Access Holdings Plc is trading at 38.1107% below its 52-week high. The share price of the financial services group had climbed to N30.7 before it retreated.
FBN Holdings Plc rose to N730 billion at the end of the trading session on Friday, moved along the banking index. Last week, the elephant branded financial services company market valuation grew to about N808 billion from N752.006 billion in the stock market due to buy side activities.
According to data from the Nigerian Exchange, FBNH share price rose to N22.25 in the market from N20.35 at the beginning of the week.
Ticker: FBNH is trading at about 49% to its 52 weeks after a persistent price decline amidst an ongoing battle between the group and Barbican Capital over shareholdings. The financial stock had peaked at N43.95 during a good time on the Nigerian Exchange before it retreated. #Nigeria’s Big Banks Market Value Climbs to N4.81 Trillion Jaiz Bank Trades at 44% Discount to 52-Week High
