Tier-1 Banks Value Hits N4.88Trn Ahead of Earnings

Valuation: The combined market value of Nigeria’s big banks has contracted below N5 trillion ahead of the fourth quarter of 2023 earnings releases by some of the big lenders in the economy.

The banking index has come under intense pressure due to rapid sales of banking stocks. Investors’ weak sentiment was triggered by margin dilutive regulatory directives targeted at foreign currency operations of local deposit money banks. In the category, the market has received unaudited results from FBN Holdings while sources told MarketForces Africa that others are waiting for final approval from the apex bank for the publication.

There has been a switch in equities investors’ mood away from banking stocks amidst growing regulatory risks.  Being one of the most liquidity indexes on the Nigerian Exchange, banking shares have seen rapid sell-offs that have plunged their combined market value to N4.88 trillion.

GTCO remains the industry leader with N1.227 trillion in market valuation as of Friday. The financial services group is yet to post its fourth quarter of 2023 earnings results to the Nigerian Exchange. Its share price settled at N41.7%, making it the most expensive among its peers in the tier-1 category. Last week, GTCO gained about 7% ahead of its earnings release.

Zenith Bank plc ranked second in terms of market value. The bank’s share price rose moderately to N35.5 on Friday from N35.3. This slightly nudged Zenith Bank’s market capitalisation to N1.114 trillion, making the bank the second most valuable in the Tier-1 category.

Like GTCO, Zenith Bank is expected to release its earnings scorecard in March 2024. FBN Holdings Plc is the third rated in terms of market capitalisation in the Tier-1 bank segment.  The Elephant branded financial services group posted impressive earnings in 2023, details from its unaudited report showed.

Ticker: FBNH has been relatively volatile lately due to various investors’ interest in the group. Its market valuation slumped to N1.008 trillion as its share price cleared lower at N28.1 on Friday from N31.

UBA Plc came fourth on the tier-1 banks ranking, commanding N787 billion in market valuation, according to details from the stock market. UBA’s share price dropped to N23 on Friday’s close from N23.90 in the comparable trading period.

The Pan African lender has not released its earnings for the final year just like others. However, analysts noted that UBA posted better earnings than its peers in Q3-2023, which could be positive for the lender’s overall annual performance. #Market Priced Nigerian Big Banks for N4.88Trn Transcorp Worth Increase to N580bn after Good Earnings

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