Britam Shares Surge to 11-Year High, Announces Dividend Resumption

Britam Shares Reach 11-Year High Amid Dividend Expectations

Shares of insurance firm Britam have surged to an 11-year high of Sh19.95, driven by a significant rally this month fueled by investor optimism that the company may resume dividend payments after a six-year hiatus. The stock has experienced a remarkable 60% increase over the past three weeks, doubling the gains it achieved in the first half of the year. This impressive performance places Britam as the second-top-performing stock at the Nairobi Securities Exchange (NSE), trailing only Car & General with a 136% year-to-date gain.

The company’s market capitalization has also seen a substantial rise, increasing by Sh18.7 billion to reach Sh50.3 billion over the same period due to the share price surge. Analysts attribute the current market enthusiasm to speculative trading by local investors who are drawn to the company's recent efforts to clean up its balance sheet by addressing accumulated losses of Sh5.88 billion.

According to Melody Ndanu, a research analyst at Standard Investment Bank, the rally is not the result of any special market action but rather stems from the balance sheet cleanup that has created hope for a potential resumption of dividend payments. She noted that the demand for Britam shares has primarily come from local investors, particularly fund managers.

Share Premium and Dividend Resumption

Britam shareholders approved a resolution during the company’s annual general meeting in May to use part of its share premium of Sh13.2 billion to clear the accumulated losses. This move has paved the way for the potential resumption of dividend payments. Share premium refers to the amount paid by investors for newly issued shares above their par value. Importantly, reducing the share premium does not impact the company’s equity position or shareholding structure.

Before tapping into the share premium, Britam had been relying on dividends from its subsidiaries to reduce accumulated losses over a five-year period. The company, which operates life assurance, general insurance, and asset management across seven countries including Kenya, Rwanda, Uganda, Tanzania, South Sudan, Mozambique, and Malawi, has gone six years without paying dividends. However, managing director Tom Gitogo indicated in March that clearing the accumulated losses would open the door to a possible dividend payout this year, potentially an interim one.

Britam reported a 10% growth in net profit for the year ended December 2025, reaching Sh5.5 billion, compared to Sh5 billion in 2024. Among the six listed insurers at the NSE, only Britam and Sanlam Allianz Holdings failed to pay a dividend in 2025. Sanlam Allianz reported a net profit of Sh838 million last year but has not distributed dividends for 12 consecutive years.

Performance of Other Insurers

Other listed insurance firms have recorded lower gains compared to Britam in the year-to-date period. Kenya Re has gained 18%, reaching Sh3.55 per share, while Jubilee Holdings’ share price has appreciated 12% to Sh375.50. Sanlam Allianz Holdings is up 3% to Sh8.72 per share, CIC Insurance remains flat at Sh4.56, and Liberty Holdings has declined 10% to trade at Sh9.10 per share.

Overall, only Britam and Car & General have recorded share price gains exceeding 100% this year. The next best performers include I&M Group (63%), Uchumi Supermarkets (62%), and Kenya Airways (61%). The NSE has added Sh959.6 billion or 33% in investor wealth during the period, partly driven by the new listings of Kenya Pipeline Company (KPC) and Family Bank, which injected a combined Sh206.7 billion in new wealth into the market.

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