Analysts project low dividends for shareholders in banks
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“On average, banks are maintaining their dividends despite dips in earnings. We, however, expect a drop of at least 4.4 per cent in dividends for StanChart driven by a projected 28.1 per cent decrease in earnings per share,” said SIB. It projects Equity Bank to have the highest cost-to-income ratio at 52.1 per cent, which will narrow its profits that are expected at six per cent in earnings per share. Banks are feeling the pinch of the disruptions occasioned by last year’s prolonged electioneering period, made worse by the rate cap, with initial results suggesting an industrywide profit squeeze. The country’s biggest lender by assets, KCB, saw the profits in its Kenyan business shrink three per cent from Sh19.7 billion in 2016 to Sh19.2 billion last year. Regional subsidiaries helped prop the group’s profits back to Sh19.7 billion.