Genghis Capital - Absa Bank Kenya (ABSA) Barclays Bank of Kenya Plc (NSE: BBK): 1H18 Earnings Note

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Genghis Capital

Gerald Muriuki

EUR 25.82 For Business Accounts Only

Barclays Bank of Kenya Plc (NSE: BBK): 1H18 Earnings Note

Barclays Bank of Kenya Plc (NSE: BBK) announced a 6.2% y/y growth in 1H18 earnings per share (EPS) to KES 0.69. Performance was solid across income lines, with a net interest income (NII) growth of 4.0% y/y and non-interest revenue (NIR) growth of 6.9% y/y. The uptick in non-performing loan (NPL) book continues being a concern, with a record high NPL ratio of 7.7% in 2Q18 from 7.2% in 1Q18 and against a 3-year average of 5.4%. A dividend of KES 0.20 is recommended to shareholders on register as at 7^th September 2018. Despite trading at sector average multiples (P/B of 1.5x), BBK continues offering a good dividend yield at 8.1%, against sector's 4.7%. Against our target price, which is currently under review, of KES 11.48, we maintain a HOLD recommendation on BBK.

15/08/2018 5 EN

Underlying

Absa Bank Kenya

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KE0000000067 Nairobi Securities Exchange Kenya

Provider

Genghis Capital

Genghis Capital is an innovative and customer focused Investment Bank licensed by the Capital Markets Authority (CMA). Founded in 2008, Genghis is one of the leading investment banks in Kenya. Since its establishment, Genghis has achieved tremendous growth to offer a well-diversified portfolio of financial services that includes:

i. Securities(Equity/Debt) Trading
ii. Research
iii. Wealth Management services
iv. Investment Advisory & Management via the GenCap Unit Trusts
v. Corporate Finance & Transaction Advisory services

The Kenyan Capital Markets continue to develop in size, scope and sophistication. With this is an increasing demand for more specialized and personalized brokerage service and we at Genghis Capital are glad to be able to offer you this service. Our strength lies in ensuring our clients are up to speed with developments at the stock market and the economy. Research and technology remains our competitive and comparative advantage hence Experience, Expertise and Professionalism are some of the qualities you can expect from our team.

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Analysts

Gerald Muriuki

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Barclays Bank of Kenya Plc (NSE: BBK): 1H18 Earnings Note

Bank Brunch/Qatar sells down Barclays, Moody's negative on banks, November covered supply at €11bn

Absa Kenya: 9M 21: Bank hits management ROE target of 20%; new level seems sustainable

Kenya Banks: Sector Q3 21 PBT jumps 68% yoy, and outlook for Q4 is positive too

Genghis Cross-Asset Weekly Strategy - 8th February 2021

East African Breweries Ltd (NSE: EABL) 1H21 Earnings Note

KenGen Company Plc (NSE: KEGN) FY20 Earnings Note

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