Banco Angolano de Investimentos – Growing retail presence

Sustained recovery in the Angolan economy

Angolan GDP rose strongly in 2024 to 4.5%, with continued growth forecast for 2025 and beyond, despite recent tariff shocks and a lower oil price. Banco Nacional de Angola (BNA) has encouraged a stable currency, supported by healthy foreign reserves at 37% of external debt. While debt remains high, it is forecast to decline to 46.8% of GDP in the second part of 2025, with oil revenue sufficient to cover finance servicing costs. The Angolan government funded a US$200m margin call during the uncertainty earlier in the year. Inflation is on a downward trajectory, thanks to currency stability, and could drive an interest rate easing cycle from the latter part of 2025.

Strong client growth and credit potential

BAI has been successful in expanding its reach in recent years, with 27% per year average growth in distribution channels since FY20. This has helped the company to more than double its active customers to 2.7 million by H125. On a consolidated basis, BAI has increased its loan-to-deposit ratio from 18.6% in FY23 to 25.3% in FY24. For the Angolan company alone, the increase has been even more impressive: from 12.6% in FY23 to 24.5% H125. Credit quality has remained healthy despite the increased growth.

BODIVA strategy offers potential for BAI

The Angolan stock exchange increased its market capitalisation to 15.6% of GDP in 2024 and is targeting 50% over the next five years, supported by the launch of the Commodities Exchange, the Derivatives Market and a pipeline of initial public offerings (IPOs). BAI, as the largest listed equity on the exchange, is set to benefit from the increased volumes and liquidity that BODIVA’s strategy may deliver.

Strong share price performance

BAI’s share price has rallied by 48% year to date to Kz83,000/share, far outperforming local and regional peers. Its return on average equity (RoAE) of 26.4% (26% for the peer group), based on its consolidated financials, compares to a price-to-book multiple of 1.7x (peer group: 1.4x).

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