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This research report was prepared by the Research Department of Old Mutual Securities Limited. Old Mutual Securities Limited is a securities trading company licensed by the Capital Markets Authority (Kenya) for the purpose of facilitating trade on the Nairobi Securities Exchange.

Here are our views on the news making headlines today for Kenya:
StanChart asks parent firm to split stock. The bank’s stock is currently trading at Sh302 a share, making it the most priced bank counter and out of reach of many retail investors.

Our View: This augurs well for the bank’s liquidity in the NSE as the bank witnessed the second lowest turnover among the top 20 largest companies at the bourse in the first six months of the year. The bank has also experienced Sluggish performance – in FY14A, the bank experienced a negative growth on both the customer deposits (-0.4%) and net loans and advances (-5.3%) on the backdrop of increased competition. SCBK continues to curve a niche on affluent and wholesale banking units through priority banking. Despite these segments getting an outstanding traction, other banks have devised a strategy to compete for a juicy morsel on this niche market including KCB and Barclays Bank both with KCB Advantage and Prestige Banking respectively.
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