Last lesson you ran the full toolkit on Safaricom. Today you run the same toolkit on a bank — Equity Group Holdings — and form your own reasoned view on whether its roughly KShs 327 billion market cap looks justified by what the numbers actually say.
This lesson introduces no new ratios or concepts. Everything below reuses what you already learned in Lessons 6–17: how a bank's statements are structured, margins, return on equity, debt-to-equity, EPS, the P/E ratio, and dividend yield. The only thing that's new is the company. Working through a second, structurally different business is how you check that you actually understand the tools, rather than having memorised one worked example.
As Lesson 6 explained, a bank's statements read differently from an ordinary company's. Customer deposits are a liability (money the bank owes back to depositors), and loans to customers are an asset (money customers owe back to the bank). "Revenue" for a bank is net interest income plus non-interest income, not a single sales line. Keep that structure in mind as you read the numbers below.
Equity Group's Statement of Comprehensive Income for the year ended 31 December:
| KShs '000 | FY2024 | FY2023 |
|---|---|---|
| Total interest income | 170,285,001 | 155,992,438 |
| Total interest expenses | (61,575,230) | (51,190,823) |
| Net interest income | 108,709,771 | 104,801,615 |
| Total non-interest income | 85,072,327 | 76,881,249 |
| Total operating income | 193,782,098 | 181,682,864 |
| Total operating expenses | (133,043,143) | (129,803,990) |
| Profit before tax and exceptional items | 60,739,955 | 51,878,874 |
Source: Equity Group Holdings PLC Audited Financial Statements and Other Disclosures for the Year Ended 31 December 2024 (audited, currency Shs'000).
Unlike Safaricom's FY2024 (revenue up, profit down — Lesson 1's red flag), Equity Group shows growth moving the same direction on every line: operating income up +6.7% (181,682,864 → 193,782,098) and profit before tax up +17% (51,878,874 → 60,739,955). Profit before tax grew faster than operating income, meaning the business became somewhat more efficient, not just bigger — operating expenses grew only +2.5% (129,803,990 → 133,043,143) while operating income grew +6.7%.
| KShs per share | Value |
|---|---|
| Basic & diluted EPS, FY2024 (year ended 31 December 2024) | 12.34 |
| Share price (~15 July 2026) | 86.75 |
| P/E = 86.75 ÷ 12.34 | ≈ 7.0x |
Source: Equity Group Holdings PLC Audited Financial Statements and Other Disclosures for the Year Ended 31 December 2024, https://equitygroupholdings.com/wp-content/uploads/2025/03/Equity-Group-Holdings-PLC-Audited-Financial-Statements-for-the-Year-Ended-31st-December-2024.pdf (EPS, audited, currency KShs); share price from market data aggregators, 15 July 2026.
This 7.0x pairs a mid-2026 share price with an EPS figure from the year ended 31 December 2024 — over a year old. Equity Group has already reported Q1 2026 results showing EPS of KShs 4.86 for the quarter, up from KShs 3.92 a year earlier, which suggests FY2024's EPS is understating current earnings power. Using the Kenyan-market rule of thumb from Lesson 16 (below roughly 10x often considered "low," above roughly 20x often considered "expensive"), 7.0x sits on the low side — but treat this as illustrative only, not a final verdict, and check Equity Group's investor relations page for the latest reported EPS before acting on it.
| KShs per share | FY2024 (declared) | Most recent (FY2025, ex-date 25 May 2026) |
|---|---|---|
| Dividend per share | 4.25 | 5.75 |
Source: Equity Group Holdings PLC Audited Financial Statements and Other Disclosures for the Year Ended 31 December 2024, https://equitygroupholdings.com/wp-content/uploads/2025/03/Equity-Group-Holdings-PLC-Audited-Financial-Statements-for-the-Year-Ended-31st-December-2024.pdf (FY2024 dividend, audited, currency KShs); most recent dividend from market data aggregators.
Note the year mismatch flagged back in Lesson 17: the KShs 4.25 figure is what Equity Group's FY2024 annual report declared, but the company has since declared a larger FY2025 dividend of KShs 5.75. Using the more recent KShs 5.75 against the mid-July 2026 price of KShs 86.75 gives a dividend yield of 5.75 ÷ 86.75 ≈ 6.6% — again, an illustrative calculation mixing periods, not a precise trailing yield.
| KShs '000 | 2024 | 2023 |
|---|---|---|
| Customer deposits | 1,399,648,121 | 1,358,227,584 |
| Loans and advances to customers (net) | 887,379,832 | 819,235,956 |
| Total assets | 1,804,624,428 | 1,821,434,520 |
| Total liabilities | 1,557,758,334 | 1,603,299,418 |
| Total shareholders' funds | 246,864,094 | 218,135,102 |
Source: Equity Group Holdings PLC Audited Financial Statements and Other Disclosures for the Year Ended 31 December 2024 (audited, currency Shs'000).
Total liabilities (1,557,758,334) are about 6.3 times total shareholders' funds (246,864,094) — a debt-to-equity level that would look alarming for an ordinary company like Safaricom, but is normal for a bank, exactly as Lesson 12 explained. A bank's core business is taking in deposits (a liability) and lending them out (an asset) — high leverage is the business model, not a warning sign on its own.
Lesson 10 computed Equity Group's ROE using total comprehensive income for the year (43,826,758) as a proxy for net profit after tax, divided by total shareholders' funds (246,864,094): 43,826,758 ÷ 246,864,094 ≈ 17.7%. That figure carries the same caveat as before — total comprehensive income includes other comprehensive income items, not just trading profit — but it's in the same ballpark as many well-run banks, and comfortably higher than what you'd expect from a savings account.
Here is everything gathered in one place, exactly as reported, so you can form your own view rather than being handed one:
None of this proves the KShs 327 billion market cap is "correct" — no single lesson, or single set of ratios, can prove a share price is right. What the evidence above supports is a reasoned, specific view: profit and operating income are both growing, the illustrative valuation multiples look reasonable-to-cheap rather than stretched, and the balance sheet structure is normal for the industry. Whether that adds up to "worth buying at today's price" still depends on things this course deliberately hasn't covered — your own risk tolerance, how much you trust the FY2025/2026 trend continuing, and what else you could do with the money. The point of this lesson isn't to hand you a verdict; it's to show you that you can now build one yourself, line by line, from real numbers instead of a headline.
Next lesson is the capstone: Your Investment Decision Framework — pulling everything from this course into one repeatable personal checklist you can apply to any company, not just Safaricom or Equity Group.
Primary source for this lesson's numbers: Equity Group Holdings PLC Audited Financial Statements and Other Disclosures for the Year Ended 31 December 2024.
Something unclear, or want to dig into a line item we skipped (like "what exactly sits inside non-interest income")? Ask your teacher — that's what these sessions are for.