The FUGAZ banks; First Bank, UBA, Guaranty Trust Holding Company (GTCO), Access Bank, and Zenith Bank have continued to create wealth and add value to investors.
The FUGAZ banks’ combined market capitalization increased by N981.394 billion, a 20% YtD growth, reaching N5.932 trillion by December 6, 2024.
This growth not only enriched shareholders through capital gains but also boosted confidence in the Nigerian stock market, attracting both local and foreign investments.
In addition, the group paid an interim dividend for the first half of the year amounting to N145.221 billion, compared to N58.177 billion for the same period in 2023.
These dividend payouts highlight the banks’ profitability and commitment to enhancing shareholder returns, contributing to the overall total return
Investor gains
The increase in share prices translates into capital gains for individual investors enhancing their personal wealth.
- For instance, a retail investor who bought 1,000 shares of GTCO at the start of the year at N40.50 would see their investment grow to N53,200 by December 6, reflecting a 31.4% gain.
Pension funds, insurance companies, and other institutional investors that hold significant positions in FUGAZ banks benefit from the rising market capitalization.
- For example, Pension Fund Administrators (PFAs), which invest heavily in blue-chip stocks like FUGAZ, can generate higher returns for their contributors, indirectly impacting the financial security of millions of Nigerians.
The FUGAZ group’s contribution to the NGX’s total market capitalization strengthens the overall stock market, attracting foreign and local investment.
This increases liquidity and stability, providing broader economic benefits and opportunities for all market participants.
Market Cap progression overview
By the end of Q3 2024, the FUGAZ banks experienced notable fluctuations in market capitalization.
After a strong 22.14% increase to N6.06 trillion in Q1 2024, driven by solid earnings growth in 2023, the market cap dropped 22.72% to N4.673 trillion in the first half of 2024, mainly due to regulatory concerns and cautious investor sentiment.
However, in Q3 2024, the banks rebounded with a 12.72% recovery, reaching N5.267 trillion, and further rose to N5.932 trillion as of December 6, 2024, reflecting improved investor confidence following successful public offers and rights issues.
Individual Bank growth
GTCO – N373.776 billion market cap growth
Guaranty Trust Holding Company Plc (GTCO) led the FUGAZ group in total market capitalization.
As of December 6, 2024, GTCO had added N373.776 billion to its market capitalization, bringing its total to N1.566 trillion, the highest among the group.
- GTCO began the year with a share price of N40.50 and has since gained 31.4% on that price valuation, ranking it 2nd among the FUGAZ.
- Additionally, the bank paid an interim dividend of N1 per share for the first half of 2024, doubling the N0.50 per share paid for the same period in 2023.
- The stock has relatively modest trading activity as depicted in its trading volume.
- Over the past three months (September 6 and December 6), the stock traded a total volume of 702 million valued at N35.9 billion and ranked 13th on the NGX.
- This suggests that the stock is a steady performer with adequate but not top-tier liquidity, reflecting a balanced level of investor interest.
- GTCO’s pre-tax profit of N1.219 trillion in the first nine months of 2024, is the highest among the FUGAZ group.
- This suggests that investors can expect continued growth supported by the bank’s strong fundamentals.
UBA – N283.855 billion market cap growth
United Bank for Africa came second with N288.885 market capital growth pushing the bank’s market capitalization to N1.161 trillion, ranking it the 3rd most valuable FUGAZ bank.
- UBA began the year with a share price of N25.65 and has since gained 32.36% on that price valuation, ranking it 1st among the FUGAZ. In 2023, the bank also came top with a YtD gain of 238%.
- In terms of dividends, UBA leads the FUGAZ group. For the first half of 2024, it paid an interim dividend of N2 per share, representing a remarkable 300% increase in payout compared to the same period in 2023.
- The stock has relatively strong trading activity as depicted in its trading volume.
- The bank has jumped from the 8th most traded stock between May 23 and August 23, 2024, to the 1st most traded stock on NGX between September 9 and December 6, 2024, with a traded volume of 2.8 million valued at N77.7 billion.
ZENITH – N166.401 billion market cap growth
Zenith Bank saw its market capitalization surge by N166.401 billion representing 13.71% YtD growth, taking the bank’s total market capitalization to N1.380 billion, ranking it as the 2nd most valuable stock in FUGAZ
- Last year, the share price gained 61% YtD to close at N38.65 and a market capitalization of N1.213 trillion.
- In Q1 2024 market capitalization jumped to N1.397 trillion and dropped to N1.121 trillion by the end of the end of first half losing about N276 billion.
- In addition to achieving a 13.71% YtD gain in share price, Zenith Bank demonstrated its commitment to shareholder value by doubling its interim dividend to N1 per share, compared to N0.50 in the first half of 2023.
- This significant 100% increase reflects the bank’s robust financial performance and focus on rewarding its investors.
- The stock enjoys strong trading activating, currently ranked as the 6th most traded on the NGX over the past three months.
FBNH – N98.712 billion market cap growth
First Bank of Nigeria Holdings Plc (FBNH) has seen its market capitalization increase by N98.712 billion in 2024, bringing its total market cap to N944.046 billion.
- FBNH began the year with a share price of N23.55 and has since gained 11.7%, reflecting positive market sentiment.
- In 2023, the stock posted an impressive YtD gain of 116%, with its market capitalization reaching N845.334 billion.
- By the end of Q1 2024, market capitalization surged to N1.276 trillion.
- However, by the end of Q2 2024, FBNH’s market cap dropped significantly to N786.107 billion, shedding N489.971 billion over the three-month period.
- Notably, FBNH showed signs of recovery starting by the end of September 2024, with a YtD gain of 14.65%, signalling renewed investor confidence.
- FBNH enjoys robust trading activity and is currently ranked as the 5th most traded stock on the Nigerian Stock Exchange (NGX) over the past three months.
- During this period, FBNH traded a total of 1.53 billion shares, valued at N41.2 billion, reflecting strong investor interest and market participation.
ACCESS – N58.650 billion market cap growth
Access Holdings Plc’s market capitalization increased by N58.65 billion, bringing its total to N881.52 billion, making it the fifth largest among the FUGAZ group.
- In 2023, ACCESS gained 116% YtD, pushing market capitalization to N845.33 billion. It began 2024 strong, gaining 5.88% in Q1, which pushed its market capitalization to N870.86 billion.
- However, like its peers, the bank faced a decline in Q2, losing N197.28 billion in market capitalization, bringing its total down to N673.58 billion.
- By the end of November, Access Bank began to recover, with a 0.22% YtD increase, which strengthened further to a 5.88% YtD gain.
- To further boost its appeal to investors, the bank increased its interim dividend payout by 50%, raising it to N0.45 per share, compared to N0.30 in the first half of 2023.
- Notably, Access Holdings is the fourth most traded stock on the Nigerian Stock Exchange (NGX) from September 9 to December 6, 2024.
- During this period, ACCESSCORP traded 1.54 billion shares, valued at N33.5 billion.
- This high level of trading activity and volume points to strong investor confidence, liquidity, and the potential for further growth or price movements, suggesting that the company is well-positioned in the market at this time.
Outlook: The FUGAZ banks have not only created wealth for investors but have also cemented their role as pillars of the Nigerian financial system.
With strong fundamentals, increased trading activity, and stable market performance, these banks remain attractive investment options with the potential for continued growth in the coming years.