FBN Holdings Plc (FBNH) has edged past Zenith Bank in financial services companies with the most market capitalization.
The HoldCo took the second spot with a market capitalization of N1.21 trillion, slightly ahead of Zenith’s N1.15 trillion.
However, Guaranty Trust Holding Company (GTCO) continues to hold the top position as Nigeria’s most valuable bank, boasting a market capitalization of N1.36 trillion.
FBNH’s rise followed the announcement of the 100% sale of its subsidiary, FBNQuest Merchant Bank.
This strategic move appears to be positively received by the market, driving a notable increase in its share price and market capitalization.
While GTCO maintains its dominance with a market cap of N1.36 trillion, Zenith Bank has slipped to third place, with a valuation of N1.15 trillion.
Despite this, both banks, along with First Bank, have seen significant growth in share prices since 2020, reflecting sustained investor confidence in the Nigerian banking sector.
Bullish Share Price Trends
All three banks have experienced strong bullish price trends since 2020, driven by positive sentiment surrounding the sector’s resilience and profitability.
After hitting a low of N11.70 in March 2020, Zenith Bank’s share price surged by 210%, reaching a high of N44.50 in March 2024.
However, the price later dropped to N32.10 in April 2024, following market uncertainty over the bank’s capitalization plans.
FBNH has soared by 800% since hitting a low of N3.95 in 2020. Around March 2024, the stock climbed to a high of N35.55.
Shares of GTCO climbed 162%, rising from N17.70 in 2020 to a peak of N52.50 in March 2024. Despite a slight decline to N32.70 in April, the stock remains on a generally positive trajectory.
Key Drivers of Bullish Sentiment
Zenith Bank’s performance has been bolstered by impressive financial results, including a 108% year-on-year growth in pre-tax profit, rising from N350 billion in H1 2023 to N727 billion in H1 2024. Following this result, its share price surged 16%, supported by a high trading volume of 358 million shares.
For FBNH, the sale of FBNQuest Merchant Bank drove its stock up by more than 30%, reflecting investor confidence in the bank’s strategic direction.
In addition, the bank reported a pre-tax profit of N411.9 billion in the first half of 2024, a sharp increase from N205 billion in 2023.
GTCO has also shown robust financial performance, with a pre-tax profit exceeding N1 trillion in the first half of 2024, reinforcing its market leadership.
Statements from Bank Executives
Zenith Bank’s Group Managing Director, Dr. Adaora Umeoji, expressed confidence in the bank’s future, stating, “We have the capacity, the network, the balance sheet, and the technology to stay ahead in the industry.”
Similarly, GTCO’s Group Chief Executive Officer, Mr. Segun Agbaje, emphasized the company’s resilience, saying, “Despite the uncertainties in the operating environment, our record-breaking profit in the first half of the year highlights the strength of our business model.”
FirstBank Managing Director, Olusegun Alebiosu, also reaffirmed his bank’s commitment to delivering strong performance, citing its strategic moves and financial results as key indicators of future success.
Despite the dynamic nature of the banking sector, GTCO, FBNH, and Zenith remain at the forefront, showcasing resilience and growth despite a challenging economic landscape.
The positive momentum in their stock prices and financial performance highlights strong investor confidence in the sector’s future.