Why BMCE does not convince
The bank will unveil its results for 2011 in the next few weeks .But already, the investment community sees BMCE as widely overvalued stock on the market, writes Jeune Afrique.
Source : https://www.marocafrik.com/english/Why-BMCE-does-n...
Othman Benjelloun CEO of BMCE has said "In 2011, the growth of our profits will be excellent. The year was not only good for our Moroccan operations, but also to those in Africa. " When bank's the results come out in a few weeks the financial community will be able to see more clearly whether Othman Benjelloun's Africa gamble has come off. Over the years the Banks profits have dropt compared to its competitors Attijariwafa Bank and Banque Populaire who showed a total return on investment of over 60 per cent.
The worst was avoided because BMCE worked with two other major shareholders Caisse de Dépôt et de Gestion and the French Crédit Mutuel-CIC to implement buy back programmes which cost 15 per cent of the Banks capital since 2008:2009.They aim to maintain the share price above 200 dirhams.
However, the fundamentals of the bank justify a sharp decline Jeune Afrique suggests, because its share valuation
displays levels which do not relate to its sector and AlphaMena said that its target for BMCE's valuation is 129 dirhams which would signify a 38 per cent drop in share value.Attijariwafabank beats it on profit margin and return on equity. BMCE is Morocco's third largest bank.
On the other hand BMCE is commercially powerful in banking and teh Stock Exchange and has been a pioneer in bank assurance.It remains strong inthis field although Attijariwafa Bank has now surpassed it. BMCE's costs are heavier than its competitors and a very generous payment policy for senior executives, Jeune Afrique says.
Launched at a lavish press reception in November 2007at the Mansion House in London Medicapital Bank was ank part of the BMCE group provided an on-the-ground network of offices in fifteen African countries rising to eighteen countries during 2008 across North, West, East and Central Africa.It was headquartered in London and specifixcally targeted the African market with a large holding in Bank of Africa (BOA).Medicaptial's name was changed to BMCE International in 2010.While BMCE now holds 59.4 per cent stake in BOA, the bank remains highly secretive about its African strategy. And difficulties in Ivory Coast and Madagascar, as well as cleaning up new subsidiaries in Ghana and Djibouti, does bode well for profitability the article states.
Return on investment in Africa is currently limited and the cost of risk also imposes limtations.The imposition of Basel 3 places restrictions on capital and BMCE will not have much room for manoeuvre if its African operations are in difficulty the article concludes.
.
The worst was avoided because BMCE worked with two other major shareholders Caisse de Dépôt et de Gestion and the French Crédit Mutuel-CIC to implement buy back programmes which cost 15 per cent of the Banks capital since 2008:2009.They aim to maintain the share price above 200 dirhams.
However, the fundamentals of the bank justify a sharp decline Jeune Afrique suggests, because its share valuation
displays levels which do not relate to its sector and AlphaMena said that its target for BMCE's valuation is 129 dirhams which would signify a 38 per cent drop in share value.Attijariwafabank beats it on profit margin and return on equity. BMCE is Morocco's third largest bank.
On the other hand BMCE is commercially powerful in banking and teh Stock Exchange and has been a pioneer in bank assurance.It remains strong inthis field although Attijariwafa Bank has now surpassed it. BMCE's costs are heavier than its competitors and a very generous payment policy for senior executives, Jeune Afrique says.
Launched at a lavish press reception in November 2007at the Mansion House in London Medicapital Bank was ank part of the BMCE group provided an on-the-ground network of offices in fifteen African countries rising to eighteen countries during 2008 across North, West, East and Central Africa.It was headquartered in London and specifixcally targeted the African market with a large holding in Bank of Africa (BOA).Medicaptial's name was changed to BMCE International in 2010.While BMCE now holds 59.4 per cent stake in BOA, the bank remains highly secretive about its African strategy. And difficulties in Ivory Coast and Madagascar, as well as cleaning up new subsidiaries in Ghana and Djibouti, does bode well for profitability the article states.
Return on investment in Africa is currently limited and the cost of risk also imposes limtations.The imposition of Basel 3 places restrictions on capital and BMCE will not have much room for manoeuvre if its African operations are in difficulty the article concludes.
.
Source : https://www.marocafrik.com/english/Why-BMCE-does-n...