More banks to list after Access Bank – Analysts

Some stock market analysts are predicting more companies are likely to list on the Ghana Stock Exchange to meet the recapitalization requirement by the Bank of Ghana.

The assertions follow the listing of Nigerian Bank, Access bank on the domestic bourse.

The bank launched its Initial Public Officer (IPO) on Wednesday, October 19, 2016.

The offer is however expected to close on November 11, 2016.

The bank intends to raise a minimum of 104 million cedis to support its growth and expansion strategies.

An Associate, Equity Trading at UMB Capital, Kofi Kyei tells us that, one of the influences of Access bank’s listing will involve attracting other commercial banks to list on the Ghana Stock Exchange to meet the new regulatory requirement for commercial banks.

“The bank of Ghana’s decision to review the minimum capital requirement for banks from the 120 million to 500 million cedis, we expect a lot of such transactions not only the floating of shares but also mergers and acquisitions just to keep the banks within the regulatory requirements,” he stated.

Access bank becomes the first Nigerian Bank to list on the Ghana Stock Exchange.

The move also comes after calls by the Securities and Exchange Commission (SEC) for multinationals to list on the domestic bourse and improve Ghana’s capital market.

Access bank’s 4 cedis per share price will be the third highest among the banks listed on the Ghana Stock Exchange (GSE) if its bid to list is successful.

The highest is Standard chartered bank at 14 cedis 10 pesewas followed by Ecobank Ghana at 6 cedis 82 pesewas.

Responding to whether or not the 4 cedis share price is on the high side, a stock analyst, Nana Agyeman Gyamfi described the price as fair though he admitted that the banking stocks have generally not been performing well.

“In my view, looking at their fundamentals, the 4 cedi share price is not that bad and that compares favourably with other banks… I will say probably looking at the bank’s performance, the 4 cedis is a fair price for investors,” he opined.

Mr. Agyeman Gyamfi added, “Some investors will see it a bit on the high side considering the price of some of the banks that are listed on the market and the market is generally down by about 13 percent this year.”

Meanwhile both analysts have ruled out any significant distortions to other listed banking stocks following a reaction from investors.