Foreign investors offloaded 27.2 million KCB shares valued at Sh1.05 billion in the first quarter of the year on profit-taking, reversing some of the accumulation seen in 2024.
Regulatory filings show that the offshore investors held 328.29 million KCB shares as at March 31, 2025 equivalent to 10.22 percent of the bank’s total issued shares, down from 355.48 million units (11.06 percent) at the end of December 2024.
The shares divested by the offshore investors were snapped up by local institutional investors, whose holdings rose by 28.9 million shares to 2.053 billion units (63.87 percent of issued shares) from 2.024 billion (62.98 percent) in December.
Local individual shareholders, meanwhile, saw their stake fall by 1.7 million shares to 832.6 million units.
The KCB share was in high demand last year after coming from a low base to end up as the best performing banking stock on the Nairobi Securities Exchange (NSE). It gained 90 percent to end the year at Sh41.60 per share, adding Sh63.3 billion in market capitalisation or investor wealth.
Buoyed by the growing valuation on the counter, foreign investors accumulated new shares of the lender at the fastest pace in 10 years, adding 69.3 million shares in the 12 months to take their holding to a four-year high by the close of December.
The bulk of the purchases took place in the second and third quarters of the year, coinciding with the promotion of the bank to the closely watched Morgan Stanley Capital International (MSCI) main frontier markets index from its small caps index in May. This helped increase the visibility and attractiveness of the stock among foreign investors.
The MSCI World Index captures 1,395 large and mid-size companies listed in 23 developed economies, including the US, UK, Switzerland, Singapore, Germany, Israel, Japan, France and Australia.
Presently, the top constituent companies of the MSCI World Index by market capitalisation are Apple, Nvidia, Microsoft, Amazon, Facebook’s parent company Meta, Google’s parent company Alphabet, Broadcom, Tesla and JP Morgan.
The MSCI had frozen reviews of its Kenyan index between August 2022 and May 2024 due to the forex crisis, effectively stopping the introduction or removal of constituent companies and adjustments on their weighting within the index.
KCB’s share price was also boosted by the lender announcing a Sh1.50 per share interim dividend for the half-year to June 2024, following an 87 percent jump in its half-year net profit to Sh29.1 billion.
The bank eventually announced full-year net profit growth of 66.1 percent to Sh60 billion for 2024, and a final dividend of Sh1.50, taking the full-year payout to Sh3 per share.
In 2023, the bank skipped paying a dividend for the first time since 2022 as it sought to conserve capital and boost the capital base of its main subsidiary, KCB Bank Kenya.
This year, the bank’s share has recorded a price decline of 7.5 percent, trading at Sh38.50 on Friday, indicating that there has been some profit-taking by investors who want to book the high gains they enjoyed in 2024.
There has also been more volatility in the NSE and other global stock markets due to external geopolitical shocks such as the US trade tariffs on more than 100 countries across the globe.
Stocks like KCB, which have high exposure to foreign investors, have therefore been affected by the increased flight to safety from the volatility of the equities markets in the recent weeks.
