Rwanda's only listed local lender, Bank of Kigali, recorded 18.6 per cent growth in profit after tax in the first three months of this year, due to increased demand for loans.

But analysts say earnings on share price are likely to remain flat. The bank’s board proposed a dividend per share of Rwf12.15 ($0.02), a total payout of Rwf8.2 billion ($11.3 million), and will plough back the profit in line with its three-year policy to retain half of its earnings.

The first quarter results, announced by Bank of Kigali CEO Diane Karusisi, indicate that the lender made $7.2 million after tax.

The bank loaned out $470.9 million that grew the interest income.

“Bank of Kigali owes its continued resilient performance to strategic partnerships and customer loyalty,” said Ms Karusisi.

Low trade volumes

The bank’s counter has also recorded the lowest trading volumes and turnover in its history.

Latest trading statistics from RSE indicate that the volume dropped by 64 per cent in the first three months of 2016, as institutional investors held onto their shares.

The turnover at the Bank of Kigali counter dipped by 65.7 per cent in the first quarter this year compared with the same period last year, as the traded value dropped to $2.1 million from the $6.3 million traded last year.

The bank’s chief operating officer Lawson Naibo said the share price was high compared with other stocks on the RSE.

“The share price of Rwf280 ($0.37) is giving you the chance to buy,” said Mr Naibo.

“The balance sheet has expanded. The bank is more profitable and is serving more customers. We are growing at 25 per cent year on year on compounded growth. The share price will go up,” he added.

The lender’s share price has remained unchanged for the past eight months.

“I don’t expect any price movement on Bank of Kigali. The price has hit a plateau. The investment climate is not very attractive with the current forex rate,” said Davis Gathaara, the managing director of Baraka Capital Ltd.