President Kenyatta’s family, the family of former Central Bank governor Philip Ndegwa and Equity Bank CEO James Mwangi have increased their fortune by Sh1 billion each within the past two weeks.
This comes after prices for bank shares proliferated following news of a push to remove the cap on commercial lending rates, according to Business Daily.
Since October 18th, Mwangi’s five percent share in Equity Bank gained Sh1.6 billion after President Uhuru declined to assent to the Finance Bill 2019 and asked MPs to remove the cap on lending rates.
During the same period, the value of the Kenyatta family’s 13.2 percent stake in NCBA Group increased by Sh1.08 billion, pushing their total wealth in the bank to Sh7.7 billion. NCBA was formed as a result of a merger between the NIC Bank and Kenyatta family-owned CBA Group.
On the other hand, the Ndegwa family, which controls 12 percent of the merged bank, had thei share expand by Sh1 billion, putting their combined wealth in NCBA at Sh6.8 billion.
Kenyan bank shares further stepped up their rally on Wednesday after Parliament’s Finance Committee agreed to support President Kenyatta’s memorandum calling for the removal of the interest cap introduced in 2016.
Nine of the 10 banks listed on the Nairobi Securities Exchange had a rally with six of them recording double-digit gains over the last two weeks, Business Daily reported.
“We expect banking stocks to rally as their profitability prospects improve following the removal of rate caps,” investment bank AIB Capital said in a research note.
Equity’s share rose 23.6 percent over the two weeks to close trading at Sh46.50 on Thursday, while Barclays Kenya jumped 19.3 percent to trade at Sh13.30. KCB Group gained 21.5 percent, NCBA (16.3 percent) and Co-operative Bank (16.9 percent).