Kenya: Stock Exchange returns to profit

Kenya: Stock Exchange returns to profit

by / Comments Off / 22 View / 2nd August 2010

Last year massive losses and large price corrections were recorded due to a slow market. However, investors at the Nairobi Stock Exchange (NSE) are finally shaking off the dust of these losses, as clear rays of recovery began showing their radiance across stockbrokers and investment banks.

An analysis of the latest half-year results released by Suntra Investment Bank and Apex Africa, show that they have managed to turn around the trend through strong recovery, an indication of the changing fortune which is expected to cut across the industry.

The strong performance by Apex Africa, which becomes the second stock brokerage firm to announce its results after Suntra Investment Bank, is a clear pointer to the industry return to profitability after two years of loss making.

Income from stock dealing commission is estimated to account for 90 per cent of the returns for market intermediaries.

In the first quarter of this year a number of intermediaries also reported a return to profitability on the back of improved business.

The increased activities at the NSE are attributed to the return of both local institutional and high net worth individual and foreign investors.

“The return of institutional investors and high net worth individuals which started when the market was at its lowest level has been the driving force behind our strong earnings and we expect the momentum to be maintained going forward,” said Michael Gichohi the chief executive of Suntra Investment Bank.