Equity Bank’s mobile offering to lift its third quarter results

NAIROBI, KENYA: Equity Bank to will release its nine months financial results tomorrow, becoming the first commercial bank to do so ahead of the competition. The bank has been in the public limelight in recent weeks since announcing plans to enter the mobile money transfer business. Using the thin SIM platform, the service offered by the bank will allow users to send cash to any mobile phone network.

Financial results for the first six months of this year put Equity’s pre-tax profits at Sh7.66 billion from Sh6.02 billion over a similar period last year. This placed it in second place behind leaders Kenya Commercial Bank whose half year pre-tax profit hit Sh8.1 billion up from Sh7.1 billion in the six months of 2013.

“Equity Bank’s share price currently has the highest forward expectations baked into it on the basis that the Mobile Money Offering will be disruptive and has a regional outlook,” said Aly Khan Satchu, an independent financial analyst. During the Thursday briefing, investors will be closely watching how continued political upheavals in South Sudan have impacted Equity’s bottom line. Equity Bank has one of the largest networks in South Sudan behind KCB, which occupies the top position.

SHARES TRADED

At the close of trading yesterday, Equity Bank share price had risen 0.99 per cent, becoming the second highest mover after Safaricom with 4.74 million as volume of shares traded.

“We are expecting further growth this quarter due to return on assets for the entire industry which has been increasing. Compounded annual growth rate of the industrials’ total assets has also been steady,” said Amish Gupta, Associate Director at Standard Investment Bank (SIB).

Equity has teamed up with telecoms firm, Airtel Kenya to roll out its telecoms business. It will offer its customers SIM cards linked directly to their bank accounts.