KCB bank serving customers. PHOTO | BMS
KCB bank serving customers. PHOTO | BMS

Shareholders may reap big after the government lifted the caps rate. According to the Nairobi Stock Market, it has shown a positive transformation in the banks with a new scale of profit comes to the end of companies final years.

Listed commercial banks share prices are set to re-adjust downwards in the near term as the market absorbs shocks emanating from observed investor overexcitement on the repeal of interest rate caps.

This is as the banking counter sees off exits from investors who moved to lock in profits from the anticipated appreciation of dividend yields to shareholders from the upcoming profit declarations by banks in the first quarter of the year.

“The market might have moved slightly more than expected to news of the interest caps repeal. What’s holding down the banks stock share prices is the locking in of profits from the anticipation of dividend appreciation,” Genghis Capital Equities Analyst Patrick Mumu said.

Commercial banks are expected to reveal higher earnings for the year closing December 31, 2019, beginning in February and the subsequent announcement on dividend pay-outs to shareholders.

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