Price has already reached 14/- today.

Positive thing to note that cost to income ratio is now at 52 percent.

I rate BBK BUY due to its strong capital and liquidity position. I also expect some of the losses arising from its bond portfolio to be written back in 2012 as interest rates fall. The bank has cleaned its loan book and I think they have more than enough capital to start playing aggressive again. The stock currently trades on a trailing PE of 8.7 and a dividend yield of 11.5% based on today’s quoted price of Sh13 a share. I value the stock at Sh17 thus it has the potential of returning more than 40% in 2012 if one factors in the current 11.5% dividend yield.

Read the entire post here http://contrarianinvesti...011-earnings-my-analysis

eps 1.49, final dps 1.50. They have paid more than they earned last year!!!

The dps of 1.50 is made up of 0.20 interim, 0.70 final and 0.60 special.

The special dividend is suspicious to me, coming off another special dividend last year (attributed to the SCB sale).

In my books, any one who doesn't retain cash is either out of growth ideas or has matured and is slowly decaying.

Gordon Gekko wrote

eps 1.49, final dps 1.50. They have paid more than they earned last year!!!

The dps of 1.50 is made up of 0.20 interim, 0.70 final and 0.60 special.

The special dividend is suspicious to me, coming off another special dividend last year (attributed to the SCB sale).In my books, any one who doesn't retain cash is either out of growth ideas or has matured and is slowly decaying.[/quote]


Spots on @GG.
It is only in NSE Kenya that special dividends excites investors.
It is a Greek gift!!!.

I have said it before. This bank has refused to grow. Net assets are heading south. The have reduced the net provision from last year on bad and non performing debts. Isolating this item alone may mean there was no increase in profits. But then again, perception is everything in this market.

Would it not be better if they retained more of their profit?

[quote=the deal]I rate BBK BUY due to its strong capital and liquidity position. I also expect some of the losses arising from its bond portfolio to be written back in 2012 as interest rates fall. The bank has cleaned its loan book and I think they have more than enough capital to start playing aggressive again. The stock currently trades on a trailing PE of 8.7 and a dividend yield of 11.5% based on today’s quoted price of Sh13 a share. I value the stock at Sh17 thus it has the potential of returning more than 40% in 2012 if one factors in the current 11.5% dividend yield.

Read the entire post here http://contrarianinvesti...11-earnings-my-analysis[/quote]

@deal. What's the loss on the value of their bond portfolio in shillings? And what's the ratio of their Tbond to Tbill holdings?

@Q3 2011
BBK total capital/ risk weighted assets = 25.1% (minimum = 12%)
Liquidity ratio= 47.9% (minimum =20%)
Debt/equity= 0%

Equity bank total capital/ risk weighted assets = 23% (minimum = 12%)
Liquidity ratio = 34% (minimum = 20%)
Debt/equity = 38%

KCB total capital / risk weighted assets = 16.3% (minimum = 12%)
Liquidity ratio = 28.7% (minimum = 20%)
Debt/equity = 24%

Co-op total capital / risk weighted assets = 13.2% (minimum = 12%)
Liquidity ratio = 27.5% (minimum = 20%)
Debt/equity = 2.4%

Co-op is really doing badly and yet they have shelved their plans to do a rights issue until 2013. What makes you think KCB will carry out one this year or next year¿¿

All these banks except equity have room to borrow funds and use retained earnings to finance their capital base without doing a rights issue...

These ratios show that Barclays is way too conservative if you ask me which means EPS will probably stagnate in the future..

@the deal Have you ever heard of "pecking order theory" before¿¿

Even if ratios are squeezed.. A rights issue would be the very last option.. These banks are more than able to borrow more and also use retained earnings...