Stanbic, Sterling, Unity Bank Lead as Banking Index Gains 54% Amid CBN’s Forex Unification
- The Nigerian Exchange Limited (NGX) Banking Index increased by 54.08% year-till-date
- According to investigations, the CBN Forex unification policy drove a major review of the indexes
- Stanbic IBTC Holdings, Sterling Financial Holdings Company, and Sterling gained the most
Unlock the best of Legit.ng on Pinterest! Subscribe now and get your daily inspiration!
The Nigerian Exchange Limited (NGX) Banking Index has increased by 54.08% year-till-date.
This followed President Bola Tinubu's economic reforms, which were highlighted by the unification of foreign exchange and impressive corporate profitability.
Investigations by THISDAY found that the banking index is trailing the NGX Oil & Gas Index and NGX Consumer Goods, which have increased by 103.22% and 80.50%, respectively, year to date.
Source: UGC
Following the Central Bank of Nigeria's (CBN) naira unification measures, which attracted more foreign participation and caused them to rush to take positions in banking stocks that were previously cheap, investors made positions in the sector between June and August.
PAY ATTENTION: Follow us on Instagram - get the most important news directly in your favourite app!
Recall that Legit.ng reported that Nigeria's central bank has abolished the country's multiple exchange rate system and floated the naira currency.
Banking Index increased between June and August 2023
Analysis of trading activity revealed that due to a rise in the prices of Sterling Financial Holdings Company Plc, Unity Bank Plc, Stanbic IBTC Holdings Plc, Access Holdings Plc, Zenith Bank Plc, and Guaranty Trust Holding Company Plc, among others, the Banking Index between June and August 2023 increased by 23.5% to 646.29 basis points.
The top three gainers in terms of stock price were Stanbic IBTC Holdings, Sterling Financial Holdings Company, and Unity Bank.
Unity Bank increased its share price from N0.53 when it first opened in June 2023 to N1.22 as of August 2023, a rise of 130.2%.
While Stanbic IBTC Holdings closed August 2023 at N65.00 per share, an increase of 62.5 percent from N40 per share it opened for trading in June, Sterling Financial Holdings Company, formally Sterling bank, closed August 2023 at N3.34 per share, an increase of 62.9 percent from N2.05 per share it opened for trading in June 2023.
The stock price of Union Bank of Nigeria has decreased by 9.7% to N6.50 per share as of August 31, 2023 from N7.20 per share when it first started for trading in June 2023 as a result of Titan Trust Bank Limited's partially completed acquisition of the institution.
Additionally, after the CBN announced its foreign exchange liberation strategy, UBA, Access Holdings, and GTCO have increased by 41.4%, 34.96%, and 27.87%, respectively.
Impressive company profits also help to drive up stock values. The likes of GTCO, Fidelity Bank and Stanbic IBTC Holdings have so far declared interim dividend for half year ended June 30, 2023.
The unaudited H1 2023 profit before tax reported by FBN Holdings, the country's oldest financial institution, was N206.3 billion, a record high.
This is significantly more than the N65.7 billion declared in H1 2022 by roughly 213.8 percent.
Access, other banks receive 4.57m customer complaints demanding N52.53bn refund
Seven of Nigeria's top commercial banks have reported receiving 4.57 million customer complaints in a year, from January 1 to December 31, 2022, Legit.ng earlier reported.
The 2022 complaint figures represent an increase when compared to customer complaints received by the surveyed banks in 2021.
These figures were captured in the banks' annual financial reports, which were submitted to the Nigerian Exchange.
Source: Legit.ng
